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 for 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.
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.
Where Kars4Kids Money Really Goes
In other words – Kars4Kids used only 10% 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 anywhere else 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.
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.
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.
Copyright (C) Evelyn Kanter
ecoXplorer Evelyn Kanter is a journalist with 25+ years of experience as a newspaper and magazine writer, radio & TV news producer & reporter, and author of guidebooks and smartphone apps – all focusing on travel, automotive, the environment and your rights as a consumer.
ecoXplorer Evelyn Kanter currently serves as President of the International Motor Press Assn. (IMPA), a former Board Member of the Society of American Travel Writers (SATW) and a current member of the North American Travel Journalists Assn. (NATJA) and the North American Snowsports Journalists Assn. (NASJA).
Contact me at email@example.com.