Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes is a source document that a charitable organization files with the IRS when they receive a donation of a qualified vehicle with a claimed value of more than $500. A qualified vehicle is considered (a) any motor vehicle manufactured primarily for use on public streets, roads, and highways, (b) a boat, or (c) an airplane.
The organization is also required to provide the taxpayer with a contemporaneous written acknowledgment of the donation. An acknowledgment is considered contemporaneous if it is furnished to the taxpayer no later than 30 days after the date of the sale of the vehicle, or the date of the contribution. Copy B of Form 1098-C is typically used for this purpose, but the taxpayer might receive this statement in a different form.
A taxpayer's itemized charitable deduction is generally limited to the lesser of the actual sales price of the vehicle when sold by the charity or the vehicle's fair market value, unless the charity makes significant use of the vehicle or otherwise donates or sells the vehicle to a needy individual at a significantly below-market price. Form 1098-C should indicate what the organization has done or is doing with the vehicle by which check box in Box 4a, 5a, or 5b is checked.
To enter a contribution of a motor vehicle, boat, or airplane reported on Form 1098-C or similar statement in TaxSlayer ProWeb, from the Federal Section of the tax return (Form 1040) select:
- Deductions
- Itemized Deductions
- Gifts to Charity
- Non-Cash Donations (more than $500) - Enter all the information needed.
- Check here if you were issued a 1098-C for this property - Check the check box and enter all the information as shown on the 1098-C.
If you are e-filing the tax return, you can attach a PDF copy of Form 1098-C here:
- Deductions
- Itemized Deductions
- Gifts to Charity
- Contributions of Motor Vehicles, Boats and Airplanes
- Form 1098-C PDF upload - Click Begin. You can click the drop box to search for the PDF in Windows File Explorer or drag and drop the PDF onto it.
If you do not attach a PDF of Form 1098-C or the statement, then you should mail Copy B of Form 1098-C or the statement along with Form 8453, U.S. Individual Income Tax Transmittal for an IRS e-file Return to the IRS.
Troubleshooting
If the value of the donation is not carrying to Schedule A:
- Ensure the vehicle's fair market value has been entered.
- One of the check boxes in Box 4a, 5a, or 5b on Form 1098-C should be checked. Be sure the one that is checked is indicated in the Form 1098-C Information window, and if it's Box 4a ensure the sale date and gross proceeds are entered.
Note: This is a guide on entering Form 1098-C into TaxSlayer ProWeb. This is not intended as tax advice.
Additional Information:
IRS: Publication 526 - Charitable Contributions
IRS: Instructions for Form 1098-C - Contributions of Motor Vehicles, Boats, and Airplanes