Scam alert: You’ve heard the catchy jingle on radio and TV hundreds of times.
But Kars4Kids is not what it seems, and if you are thinking of donating your vehicle to get a tax deduction, think carefully before donating it to Kars4Kids.
The car donation charity has been accused repeatedly of misleading donors and misuse of funds, and has settled numerous lawsuits for misleading donors and misusing funds.
If you are considering donating Old Breakdown to a charity before the end of the year to get a tax donation, be sure research that charity thoroughly before you donate.
Do not make up your mind based on an infectuous radio or TV jingle you hear over and over and over.
Scam Alert:
Kars4Kids Gets Low Ratings from Charity Watchdogs
The two top charity watchdog and rating groups – Charity Navigator and Charity Watch both give Kars4Kids low-to-failing ratings, for “disguising the purpose” of donations, and because of the costly non-stop 1-877-Kars4Kids commercials with the appeal to “donate your car today”.
Kars4Kids gets a measly three stars out of five rating from Charity Navigator, in part for using nearly one-third of its income – just under 33% – for fund-raising, no independent board members and no audited financial statements on the website so contributors know where the money goes.
Non-Profit Quarterly, a trade publication which writes about charity news, describes Kars4Kids as a “a self-dealing mess”
Simply, the constant advertising eats into the amount of donation money left over to actually run the programs the advertising is promoting for any charity, and Kars4Kids appears to be more guilty than most.
The Minnesota Attorney-General accused Kars4Kids of spending just $12,000 on programs for Minnesota kids after raising some $3 million in the state, and neglecting to tell donors it turns over 90% of money left over after advertising and other expenses to another non-profit with a narrow religious and geographical focus in another state, thousands of miles away from Minnesota.
Scam Alert:
Where Kars4Kids Money Really Goes
In other words – Kars4Kids used only 1% of donations raised in Minnesota for local programs for Minnesota kids.
And the ratio is likely to be similar in the many other states where it advertises for donations.
While Kars4Kids advertises and accepts vehicle donations in all 50 states, its sister non-profit, Oorah receives 90% of operating funds.
Oorah supports only camps for Orthodox Jewish children, and only in New York and New Jersey.
If you live in Minnesota or Oregon and want to donate your car to support summer camps for Orthodox Jewish children in New Jersey, that is your right. But that is not the point.
Where the money goes is not mentioned in any Kars4Kids ads.
Also not mentioned in any Kars4Kids commercials is that Oorah actually shares an office in New Jersey with Kars4Kids, and that some employees work for both non-profits, according to the Minnesota A-G.
And according to Charity Navigator, which cites Kars4Kids for no audited financials on its website so donors know where the money goes..
In 2009, Kars4Kids settled with Pennsylvania and Oregon over similar claims of misleading donors, and of violating its tax exempt status by offering ‘free vacations’ to potential donors.
The Minnesota report says Kars4Kids raised $88 million nationally between 2012 and 2014 from scrapping and selling 160,000 vehicles, and passed nearly half of that, or $40 million, across the office to Oorah.
The Minnesota A-G has shared its 300-page report with Attorneys-General in other states and with the IRS, which could revoke Kars4Kids non-profit status if it determines there’s outright fraud.
Scam Alert:
Kars4Kids Failed Real Estate Ventures
The Minnesota report also says that Oorah lost close to $10 million in failed real estate investments, by a cousin of a Kars4Kids/Oorah executive.
Since Kars4Kids is also now soliciting donations of real estate, you would be smart to think twice about donating to a group with $10 million worth of failed real estate investments.
It’s certainly okay to donate to a charity that runs summer camps for youths of a particular religion in a particular state – so long as that’s where you want your donation money to go.
The issue here is transparency – or lack of it.
If you live in Minnesota, you should know that just 1% of your donations will be used locally.
Wherever you live, you should know how your hard earned money is being used.
Pros and Cons of Donating a Vehicle to Charity
Donating a vehicle that’s not working, and not worth the cost to repair, is a cheap way of having somebody else pay to tow it away, to be sold for parts and scrap.
But you wind up paying, anyway, since you won’t get you anything close to the tax benefits you might be promised by the donation charity.
You are better off selling Old Breakdown yourself for parts and scrap, and donating the profits directly to a legitimate children’s charity, such as the Make-A-Wish Foundation, Children’s Miracle Network or the Special Olympics.
If the vehicle is in good working order, you’ll do better selling it yourself, or donate it to a legitimate charity like Salvation Army or Volunteers of America, which will give your vehicle to a poor person who needs transportation to get a job.
Whether you are donating a vehicle, household furnishings or money, always check the charity’s rating first with one of the charity rating services.
There are plenty of A-rated charities which are transparent about how they use donation money, and don’t spend half of what they raise on non-stop radio and TV commercials.
This article was first posted in 2017 and is updated and republished regularly, including for the 2022 end-of-year charity donation season.
Copyright (C) Evelyn Kanter
ecoXplorer Evelyn Kanter is a journalist with 20+ years of experience as a newspaper and magazine writer, radio & TV news producer & reporter, and guidebook and smartphone app author – all focusing on travel, automotive, the environment and your rights as a consumer.
Contact me at evelyn@ecoxplorer.com.
Also follow my NYC website, NYC Travel Guru
I wish I had read these Comments before I donated my car. I had a 2009 Lexus
ES350 (wiring was destroyed & car total loss from Insurance). I called Cars for Kids. I asked for a receipt from one of the drivers while the other guy was hooking up my car. He said sure, no problem the receipt book is in the truck. He went to the truck supposedly to get the receipt but they drove quickly away instead. I called Cars for Kids and they said the Drivers told them that I changed my mind & did not donate. What a couple of THIEVES!!!
Have you contacted the police to make a report? You also should contact the Frauds office of the Attorney-General in your state. Please keep us posted.
We need to research the original Cars for Kids that starts with a C. I think Kars for Kids starting with the K letter, used their terminology or stole the original Cars for Kids charity. It is a shame. Hope we could somehow reorganize the original Cars for Kids, and destroy the one spelled with the K. When I start to hear their ad on Fox channel, I simply turn it off. Don Ruggles of Texarkana
I called to donate my suv. When I asked if the funds generated from the liquidation of my suv would go towards helping all kids, not just Jewish children, I was told it shouldn’t matter who it helps as long as I knew it was helping children. Not the answer I was looking for!!
Again, I asked them to be more specific. I was told that by helping Jewish children it was helping non-Jewish children indirectly. I asked them how, they couldn’t give me a straight answer.
It’s a Jewish organization, I get that. But when you start subduing like you’re hiding something, I pull back.
After reading this article I’ve decided to find another organization to donate my suv too.
Thank you so very much for your comment – and for being wise enough to find donate your SUV elsewhere when this group did not respond to your questions to your satisfaction.
I would be interested to know if there’s anyway the money is going to a political party, I know you can’t get tax exemption for political donations but what if one of them found a way around this by using tangible donations they can sell in order to let the donater get tax credit and the party still gets the money!! I’ve just found these ads to be questionable, who donates cars, real estate etc?? I knew it was a scam!!!
How can we collectively work together and have them put out of business?
PS – Thank you for your service to society.
Apparently the original Cars for Kids was an honest charity, but this one that is spelled with a K, Kars for Kids is totally a scam scheme. Many states get around 1 percent from them. Obviously, 99 percent is stolen for the people who work the system. Such a Shameful scam…..
OMG I learned so much with this article. I was going to give my car to Kars4Kids and cancelled the pick up. I do get bombarded with a lot of mail from other charities. I did say to myself that it seemed excessive, but now I need to check how much of my donations go to the intended recipient. I want to help but I want it to be maximized. Thank you for writing this.
Do some research on kars4kids and you may realise its 1 of the biggest scams going.
Agree completely – exactly why we published this article originally and have updated and republished it several times since.
I donated a minivan to Car4Kids and they promise a 2 night hotel, but to get it is so much hassle that I almost give up, but I will still want to get what they promise. I wouldn’t mind but they are the one who promise it, so I now insist on it.
Don’t hold your breath about getting a 2 night hotel. And if you do, don’t be surprised that the conditions attached prevent you from using it, or if the hotel did not authorize the coupon and won’t accept it. That’s how such scam “coupons” work. Keep me posted.
You don’t even have to do a lot of research. Just a few minutes worth of google searches will prove that it’s a total scam. It’s sneaky and deceptive and downright disgusting.
Hi Evelyl, I’m a listener to sports radio The Fann, based in N.Y. and broadcast across the U.S. and maybe Canada.
Their commercials go all day long, and one of the hosts in particular praises them, and makes them sound like the best thing that has ever happened for the benefit of kids. Maybe He’s misinformed. If the artical I read about is factual, then I wish someone with some clout would contact the station and tell them to chose who they let advertise. ( Is only about the money?) Thank You, Tired of hearing that “lovely jingle” for such a crooked charity. James Boccan
I am a used car dealer in Massachusetts and was told a few years ago by a large salvage yard in Waltham, Ma that dealt with this charity as the collector and disposal/sales agent for the actual vehicles, that they suspected this was a scam. They formed this opinion based on all interactions with the charity… If you call them about details of the free vacation or where the car money goes after they sell the cars, they just give you double talk. You don’t need a piece of paper from these clowns to claim a charitable donation, it’s merely backup if you were ever to be audited. I am quite sick of the kars4kids advertisement on Iheart radio, the former ClearChannel outfit has been under bankruptcy for a couple years and this jingle seems to be a time filler for unsold time when streaming online.
As long as the funds are being used for charitible purposes and not just to pay the CEO a six figure salary I do not see what the problem is? So the money goes to a particular religious group. I am Jewish and I also give to Christian groups. If I give a dollar I want at the very least .75 cents going to charity. It costs a lot to advertise but without it they would raise next to nothing. Charites that contact me every 60 days with a slick mailer I will not give to. They are definately spending more on advertising and office overhead than they are applying to the charity.
Kudos to you for donating both to Jewish and Christian groups. But that is not the point of this article.
The point is not all charities are what they seem, and this one is at the top of the list, hiding it’s true purpose.
Terrific if you want to donate to a charity that sends super-religious children of a particular religion to summer camp. Not terrific if that information is not included in the pitch for your money. Or that the bulk of donation funds are transferred to relatives of the charity which gets your money.
You say you donate to charities that “at the very least” spend 75 cents out of every dollar to the charity’s programs. The point of this article is to show that this charity spends less than 30 cents, the rest going to advertising.
The point of my article is to research a charity before you sent if your hard-earned money. If you still like what you see, by all means, support the charity. If not – find another charity.