Tax Deduction - Gave car as gift

My husband and I had a car with a blown engine. We gave it to a friend to let them try and fix it - they did - which we think is great.

Any chance we can claim a tax deduction? Can we write off the blue book value as a gift? Does the other person need to do anything? The blue book value was $4000.

Jbavas,

Blue Book Value of $4,000 with a blown engine???

It was nice of you to give your friend a gift.
We can not take a deduction on our taxes for giving gifts to individuals, only to qualified organizations.

And if you had given the car to a qualified organization, and the organization sold the car, the organization must report to you what they received for the car. This is your deduction amount.

On a related note, I donated a car to a local charity this year and the charity is making use of the car instead of selling it. The blue book was 1200 - 1500. Can I deduct this entire amount? If so is there addition audit risk by doing so?

Thanks.

Publius,

Audit? Maybe.

This is a deduction for Schedule A line 16, other than cash or check.
The charity should give you a receipt for the value of the car.
Because they are using the vehicle, most likely the receipt would be for the BB value.

If the Charity sells the car then they will give you a receipt for the amount they receive from the sale.

If your non-cash deductions are more than $500, you must complete form 8283, and attach it to your tax return.

AND because this is an automobile, you must attach a statement from the charity, to your tax return.

My husband and I had a car with a blown engine. We gave it to a friend to let them try and fix it - they did - which we think is great.

Any chance we can claim a tax deduction? Can we write off the blue book value as a gift? Does the other person need to do anything? The blue book value was $4000.

As far as I know you should have donated your card to make it tax deductible. I do not think you can do that by using it as a gift. Up to $5,000 you do not need much documentation to proof the value...

I donated my car once ...

Thanks

On a related issue ... if a husband gives his wife a car it is a tax write off correct?

Uh, no, it's a gift! Gifts are NOT write-offs, not tax deductions, not anything but "here, from the love in my heart".

There may be exceptions, such as that he owns a business, and the business bought her a car because she does work for the business, then the business deducts/expenses-out the car.

I totally agree with Puck. If you give somebody something then that's considered as a gift and gifts are not included in tax deductions.

"There may be exceptions, such as that he owns a business, and the business bought her a car because she does work for the business, then the business deducts/expenses-out the car." - By Puck.... I second the motion.

I think gift is not really included on tax deduction...




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IRS Problems (www.taxmatterssolutions.com)

If the gift is valued at more than $12,000, you will need to file a gift tax return. Unless you have given prior gifts during your lifetime that exceed $2,000,000, there will be not gift tax to pay, but the return should be filed.
Your friend will not have any income or gift tax liabilit.
U.S. Master Tax Guide, 2009
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Digitsy,

No, a gift tax return for a gift between spouses is not necessary...
http://www.irs.gov/businesses/small/article/0,,id=108139,00.html#3

You can visit a local IRS office to ask but you should know that many of the answers are wrong. Good luck.

you need somethign from the people you gve the car
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