Instructions for IRS Form 1098-C "Contributions of Motor Vehicles, Boats, and Airplanes"

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Instructions for Form 1098-C
Department of the Treasury
Internal Revenue Service
(Rev. November 2019)
Contributions of Motor Vehicles, Boats, and Airplanes
Section references are to the Internal Revenue Code unless otherwise
General Instructions for Certain Information Returns
for information on
noted.
how to file.
Future Developments
Do not file Form 1098-C for a contribution of a qualified vehicle
with a claimed value of $500 or less. However, you may use it as
!
For the latest information about developments related to Form 1098-C
the contemporaneous written acknowledgment under section
CAUTION
and its instructions, such as legislation enacted after they were
170(f)(8) by providing the donor with Copy C only. If you use Copy C as
published, go to IRS.gov/Form1098C.
the acknowledgment, you must check box 7. In addition, do not
complete boxes 4a through 5c or enter the donor's TIN on the form. You
Reminders
may, but are not required to, enter the donee's federal TIN on the form.
In addition to these specific instructions, you also should use the current
Section 6720 Penalties
General Instructions for Certain Information
Returns. Those general
instructions include information about the following topics.
Section 6720 imposes penalties on any donee organization that is
Who must file.
required under section 170(f)(12) to furnish an acknowledgment to a
When and where to file.
donor if the donee organization knowingly:
Electronic reporting.
Furnishes a false or fraudulent acknowledgment; or
Corrected and void returns.
Fails to furnish an acknowledgment in the manner, at the time, and
Statements to recipients.
showing the information required by section 170(f)(12).
Taxpayer identification numbers (TINs).
Backup withholding.
Other penalties may apply. See part O in the current General
Penalties.
Instructions for Certain Information Returns.
!
Other general topics.
CAUTION
You can get the general instructions at
IRS.gov/
An acknowledgment containing a certification described in box 5a or
1099GeneralInstructions
or IRS.gov/Form1098C.
5b will be presumed to be false or fraudulent if the qualified vehicle is
sold to a buyer other than a needy individual (as explained in the
Continuous-use form and instructions. Form 1098-C and these
instructions for box 5b) without a significant intervening use or material
instructions have been converted from an annual revision to continuous
use. Both the form and instructions will be updated as needed. For the
improvement (as explained in the instructions for box 5a) within 6
most recent version, go to IRS.gov/Form1098C.
months of the date of the contribution. If a charity sells a donated vehicle
at auction, the IRS will not accept as substantiation an acknowledgment
Online fillable form. Due to the very low volume of paper Forms
from the charity stating the vehicle is to be transferred to a needy
1098-C received and processed by the IRS each year, this form has
individual for significantly below fair market value (FMV). Vehicles sold at
been converted to an online fillable format. You may fill out this form,
auction are not sold at prices significantly below FMV, and the IRS will
found online at IRS.gov/Form1098C, and send Copies B and C to the
not treat vehicles sold at auction as qualifying for this exception.
donor. For filing with the IRS, follow the applicable procedures if you are
required to file electronically, or, for this form only, if you are qualified
The penalty for an acknowledgment relating to a qualified vehicle for
to file on paper, send in the black-and-white copy A with Form 1096 that
which box 4a must be checked is the larger of:
you print from the IRS website.
The gross proceeds from the sale, or
The sales price stated in the acknowledgment multiplied by 39.6%
Specific Instructions
(0.396).
The penalty for an acknowledgment relating to a qualified vehicle for
Who Must File
which box 5a or 5b must be checked is the larger of:
$5,000, or
A donee organization must file a separate Form 1098-C, Contributions of
The claimed value of the vehicle multiplied by 39.6% (0.396).
Motor Vehicles, Boats, and Airplanes, with the IRS for each contribution
of a qualified vehicle that has a claimed value of more than $500. A
Donor's TIN
qualified vehicle is any motor vehicle manufactured primarily for use on
See part J of the current
General Instructions for Certain Information
public streets, roads, and highways; a boat; or an airplane. However,
Returns
for details on requesting the donor's TIN. If the donor does not
property held by the donor primarily for sale to customers, such as
provide a TIN, you must check box 7 because the acknowledgment will
inventory of a car dealer, is not a qualified vehicle.
not meet the requirements of section 170(f)(12) and the donor will not be
Contemporaneous Written Acknowledgment
allowed to claim a deduction of more than $500 for the qualified vehicle.
Truncating donor's TIN on acknowledgements. Pursuant to
If a donor contributes a qualified vehicle to you with a claimed value of
more than $500, you must furnish a contemporaneous written
Regulations section 301.6109-4, all filers of this form may truncate a
acknowledgment of the contribution to the donor under section 170(f)
donor’s TIN (social security number (SSN), individual taxpayer
(12) containing the same information shown on Form 1098-C.
identification number (ITIN), adoption taxpayer identification number
(ATIN), or employer identification number (EIN)) on written
Otherwise, the donor cannot claim a deduction of more than $500 for
acknowledgements. Truncation is not allowed on any documents the filer
that vehicle. Copy B of Form 1098-C may be used for this purpose. An
acknowledgment is considered contemporaneous if it is furnished to the
files with the IRS. A filer’s TIN may not be truncated on any form. See
donor no later than 30 days after the:
part J in the current
General Instructions for Certain Information
Returns.
Date of the sale, if you are required to check box 4a; or
Box 1. Date of Contribution
Date of the contribution, if you are required to check box 5a or 5b.
Provide the donor with Copies B and C of Form 1098-C or your own
Enter the date you received the motor vehicle, boat,
acknowledgment that contains the required information. See the current
or airplane from the donor.
Oct 30, 2019
Cat. No. 39750N
Instructions for Form 1098-C
Department of the Treasury
Internal Revenue Service
(Rev. November 2019)
Contributions of Motor Vehicles, Boats, and Airplanes
Section references are to the Internal Revenue Code unless otherwise
General Instructions for Certain Information Returns
for information on
noted.
how to file.
Future Developments
Do not file Form 1098-C for a contribution of a qualified vehicle
with a claimed value of $500 or less. However, you may use it as
!
For the latest information about developments related to Form 1098-C
the contemporaneous written acknowledgment under section
CAUTION
and its instructions, such as legislation enacted after they were
170(f)(8) by providing the donor with Copy C only. If you use Copy C as
published, go to IRS.gov/Form1098C.
the acknowledgment, you must check box 7. In addition, do not
complete boxes 4a through 5c or enter the donor's TIN on the form. You
Reminders
may, but are not required to, enter the donee's federal TIN on the form.
In addition to these specific instructions, you also should use the current
Section 6720 Penalties
General Instructions for Certain Information
Returns. Those general
instructions include information about the following topics.
Section 6720 imposes penalties on any donee organization that is
Who must file.
required under section 170(f)(12) to furnish an acknowledgment to a
When and where to file.
donor if the donee organization knowingly:
Electronic reporting.
Furnishes a false or fraudulent acknowledgment; or
Corrected and void returns.
Fails to furnish an acknowledgment in the manner, at the time, and
Statements to recipients.
showing the information required by section 170(f)(12).
Taxpayer identification numbers (TINs).
Backup withholding.
Other penalties may apply. See part O in the current General
Penalties.
Instructions for Certain Information Returns.
!
Other general topics.
CAUTION
You can get the general instructions at
IRS.gov/
An acknowledgment containing a certification described in box 5a or
1099GeneralInstructions
or IRS.gov/Form1098C.
5b will be presumed to be false or fraudulent if the qualified vehicle is
sold to a buyer other than a needy individual (as explained in the
Continuous-use form and instructions. Form 1098-C and these
instructions for box 5b) without a significant intervening use or material
instructions have been converted from an annual revision to continuous
use. Both the form and instructions will be updated as needed. For the
improvement (as explained in the instructions for box 5a) within 6
most recent version, go to IRS.gov/Form1098C.
months of the date of the contribution. If a charity sells a donated vehicle
at auction, the IRS will not accept as substantiation an acknowledgment
Online fillable form. Due to the very low volume of paper Forms
from the charity stating the vehicle is to be transferred to a needy
1098-C received and processed by the IRS each year, this form has
individual for significantly below fair market value (FMV). Vehicles sold at
been converted to an online fillable format. You may fill out this form,
auction are not sold at prices significantly below FMV, and the IRS will
found online at IRS.gov/Form1098C, and send Copies B and C to the
not treat vehicles sold at auction as qualifying for this exception.
donor. For filing with the IRS, follow the applicable procedures if you are
required to file electronically, or, for this form only, if you are qualified
The penalty for an acknowledgment relating to a qualified vehicle for
to file on paper, send in the black-and-white copy A with Form 1096 that
which box 4a must be checked is the larger of:
you print from the IRS website.
The gross proceeds from the sale, or
The sales price stated in the acknowledgment multiplied by 39.6%
Specific Instructions
(0.396).
The penalty for an acknowledgment relating to a qualified vehicle for
Who Must File
which box 5a or 5b must be checked is the larger of:
$5,000, or
A donee organization must file a separate Form 1098-C, Contributions of
The claimed value of the vehicle multiplied by 39.6% (0.396).
Motor Vehicles, Boats, and Airplanes, with the IRS for each contribution
of a qualified vehicle that has a claimed value of more than $500. A
Donor's TIN
qualified vehicle is any motor vehicle manufactured primarily for use on
See part J of the current
General Instructions for Certain Information
public streets, roads, and highways; a boat; or an airplane. However,
Returns
for details on requesting the donor's TIN. If the donor does not
property held by the donor primarily for sale to customers, such as
provide a TIN, you must check box 7 because the acknowledgment will
inventory of a car dealer, is not a qualified vehicle.
not meet the requirements of section 170(f)(12) and the donor will not be
Contemporaneous Written Acknowledgment
allowed to claim a deduction of more than $500 for the qualified vehicle.
Truncating donor's TIN on acknowledgements. Pursuant to
If a donor contributes a qualified vehicle to you with a claimed value of
more than $500, you must furnish a contemporaneous written
Regulations section 301.6109-4, all filers of this form may truncate a
acknowledgment of the contribution to the donor under section 170(f)
donor’s TIN (social security number (SSN), individual taxpayer
(12) containing the same information shown on Form 1098-C.
identification number (ITIN), adoption taxpayer identification number
(ATIN), or employer identification number (EIN)) on written
Otherwise, the donor cannot claim a deduction of more than $500 for
acknowledgements. Truncation is not allowed on any documents the filer
that vehicle. Copy B of Form 1098-C may be used for this purpose. An
acknowledgment is considered contemporaneous if it is furnished to the
files with the IRS. A filer’s TIN may not be truncated on any form. See
donor no later than 30 days after the:
part J in the current
General Instructions for Certain Information
Returns.
Date of the sale, if you are required to check box 4a; or
Box 1. Date of Contribution
Date of the contribution, if you are required to check box 5a or 5b.
Provide the donor with Copies B and C of Form 1098-C or your own
Enter the date you received the motor vehicle, boat,
acknowledgment that contains the required information. See the current
or airplane from the donor.
Oct 30, 2019
Cat. No. 39750N
Boxes 2a, 2b, 2c, and 2d. Odometer Mileage,
not include the use of a vehicle to provide training in business skills, such
as marketing or sales. Examples of significant use include the following.
Year, Make, and Model of Vehicle
Driving a vehicle every day for 1 year to deliver meals to needy
individuals, if delivering meals is an activity regularly conducted by the
Enter the appropriate information in each box. Enter mileage only for
motor vehicles in box 2a. The following table shows three examples.
organization.
Driving a vehicle for 10,000 miles over a 1-year period to deliver
meals to needy individuals, if delivering meals is an activity regularly
Box 2a -
Box 2b - Year
Box 2c - Make Box 2d - Model
conducted by the organization.
Odometer
mileage
Material improvements include major repairs and additions that
improve the condition of the vehicle in a manner that significantly
Example 1 -
90,000
2006
Ford
Explorer
increases the value. To be a material improvement, the improvement
car
cannot be funded by an additional payment to the donee from the donor
Example 2 -
1968
Piper
Cub
of the vehicle. Material improvements do not include cleaning, minor
airplane
repairs, routine maintenance, painting, removal of dents or scratches,
Example 3 -
2008
Larson
LXI 208
cleaning or repair of upholstery, and installation of theft deterrent
boat
devices.
Box 5b. Vehicle To Be Transferred to a Needy
Individual for Significantly Below FMV
Donees must ensure that the odometer reading is in miles, not
kilometers. If the odometer is calibrated in kilometers, you must
!
Check box 5b if you intend to sell the vehicle to a needy individual at a
convert the kilometers to miles using the following calculation.
CAUTION
price significantly below FMV or make a gratuitous transfer of the vehicle
to a needy individual in direct furtherance of your organization's
Kilometers x 0.62137 = miles.
charitable purpose of relieving the poor and distressed or
Box 3. Vehicle or Other Identification Number
underprivileged who are in need of a means of transportation. Do not
enter any amount in box 4c. The donor's contribution deduction for a
For any vehicle contributed, this number is generally affixed to the
sale for this purpose is not limited to the gross proceeds from the sale.
vehicle. For a motor vehicle, the vehicle identification number (VIN) is 17
Skip this box if the qualified vehicle has a claimed value of $500 or less.
alphanumeric characters in length. Refer to the vehicle owner's manual
for the location of the VIN. For a boat, the hull identification number is 12
Box 5c. Description of Material Improvements or
characters in length and is usually located on the starboard transom. For
Significant Intervening Use and Duration of Use
an airplane, the aircraft identification number is 6 alphanumeric
characters in length and is located on the tail of a U.S. aircraft.
Describe in detail the intended material improvements to be made by the
organization or the intended significant intervening use and duration of
Box 4a. Vehicle Sold in Arm's Length
the use by the organization. Skip this box if the qualified vehicle has a
Transaction to Unrelated Party
claimed value of $500 or less.
If the vehicle is sold to a buyer other than a needy individual (as
Box 6a. Checkbox for Whether Donee Provided
explained in the instructions for box 5b) without a significant intervening
Goods and Services in Exchange for the Vehicle
use or material improvement (as explained in the instructions for box 5a),
Described
you must certify that the sale was made in an arm's length transaction
between unrelated parties. Check the box to make the certification. Also
You must check the box to indicate whether you provided goods or
complete boxes 4b and 4c. Skip this box if the qualified vehicle has a
services to the donor in exchange for the vehicle described in boxes 2a,
claimed value of $500 or less.
2b, 2c, 2d, and 3.
Box 4b. Date of Sale
Box 6b. Value of Goods and Services Provided
If you checked box 4a, enter the date that the vehicle was sold in the
in Exchange for the Vehicle Described
arm's length transaction. Skip this box if the qualified vehicle has a
claimed value of $500 or less.
If you checked “Yes” in box 6a, complete box 6b. You must give a good
faith estimate of the value of those goods and services including
Box 4c. Gross Proceeds
intangible religious benefits. Include the value of any goods and services
you may provide in a year other than the year that the qualified vehicle
If you checked box 4a, enter the gross proceeds from the sale of the
was donated. Pub. 561, Determining the Value of Donated Property,
vehicle. This is generally the sales price. Do not reduce this amount by
provides guidance for providing an estimate for the value of goods and
any expenses or fees. Skip this box if the qualified vehicle has a claimed
services.
value of $500 or less.
Box 6c. Description of the Goods and Services
Box 5a. Vehicle Will Not Be Transferred Before
If you checked “Yes” in box 6a, describe in detail the goods and
Completion of Material Improvements or
services, including intangible religious benefits, that were provided to the
Significant Intervening Use
donor. If the donor received only intangible religious benefits, check the
box.
If you intend to make a significant intervening use of or a material
improvement to this vehicle, you must check box 5a to certify that the
An intangible religious benefit is one that is provided by an
vehicle will not be transferred for cash, other property, or services before
organization organized exclusively for religious purposes and which
completion of the use or improvement. Also complete box 5c. Skip this
generally is not sold in a commercial transaction outside the donative
box if the qualified vehicle has a claimed value of $500 or less.
context.
There is significant intervening use only if the organization actually
Box 7. Checkbox for a Vehicle With a Claimed
uses the vehicle to substantially further the organization's regularly
conducted activities, and the use is significant, not incidental. Factors in
Value of $500 or Less
determining whether a use is a significant intervening use include its
nature, extent, frequency, and duration. For this purpose, use includes
If the vehicle has a claimed value of $500 or less or the donor did not
providing transportation on a regular basis for a significant period of time
provide a TIN, you must check box 7. If you check box 7, do not file
or significant use directly relating to training in vehicle repair. Use does
Copy A with the IRS and do not furnish Copy B to the donor.
-2-
Instructions for Form 1098-C (Rev. 11-2019)
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