Protecting Yourself From the Alarming Rise in Fraudulent Car Donation Programs

According to the General Accounting Office’s (GAO) 2003 report to the Senate Committee on Finance, the incidence of mis-reporting from car donation programs was out of control. In 2005, some changes were made to the rules that govern car donations and the subsequent deductions that are allowed.

However, the report also showed that an alarming 95% of third-party agents that facilitated the donations for perfectly legitimate charities and non-profit organizations (NPOs) were for-profit organizations that ate up as much as 70% (and sometimes even more) of the profits from the sale of donated automobiles. This means that a very paltry amount of the proceeds from such sales were actually reaching the charities.