Contributions of Motor Vehicles, Boats, and Airplanes

2012

Instructions for Form 1098-C
Section references are to the Internal Revenue Code unless
otherwise noted.

Reminders
General Instructions. In addition to these specific
instructions, you should also use the 2012 General Instructions
for Certain Information Returns. Those general instructions
include information about the following topics.
• Backup withholding.
• Electronic reporting requirements.
• Penalties.
• Who must file (nominee/middleman).
• When and where to file.
• Taxpayer identification numbers.
• Statements to recipients.
• Corrected and void returns.
• Other general topics.
You can get the general instructions at IRS.gov or by calling
1-800-TAX-FORM (1-800-829-3676).
How to get the latest information. If there are changes to the
2012 tax law that affect this form, you can find them at www.irs.
gov/form1098c.

Specific Instructions
Who Must File
A donee organization must file a separate Form 1098-C,
Contributions of 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 qualified vehicle is any
motor vehicle manufactured primarily for use on public streets,
roads, and highways; a boat; or an airplane. However, property
held by the donor primarily for sale to customers, such as
inventory of a car dealer, is not a qualified vehicle.

Contemporaneous Written Acknowledgment
If a donor contributes a qualified vehicle to you with a claimed
value of more than $500, you must furnish a contemporaneous
written acknowledgment of the contribution to the donor under
section 170(f)(12) containing the same information shown on
Form 1098-C. Otherwise, the donor cannot claim a deduction of
more than $500 for 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 donor no later than 30
days after the:
• Date of the sale, if you are required to check box 4a, or
• 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 acknowledgment that contains the required
information. For contributions for which you completed an
acknowledgment in calendar year 2012, file Copy A with the
IRS by February 28, 2013 (April 1, 2013, if filed electronically).
See the 2012 General Instructions for Certain Information
Returns for more information on how to file.
Do not file Form 1098-C for a contribution of a qualified
vehicle with a claimed value of $500 or less. However,
CAUTION you may use it as the contemporaneous written
acknowledgment under section 170(f)(8) by providing the donor
with Copy C only. If you use Copy C as the acknowledgment,
you must check box 7. In addition, do not complete boxes 4a
through 5c or enter the donor’s identification number on the
form. You may, but are not required to, enter the donee’s
federal identification number on the form.

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Nov 15, 2011

Department of the Treasury
Internal Revenue Service

Section 6720 Penalties
Section 6720 imposes penalties on any donee organization that
is required under section 170(f)(12) to furnish an
acknowledgment to a donor if the donee organization
knowingly:
• Furnishes a false or fraudulent acknowledgment or
• Fails to furnish an acknowledgment in the manner, at the
time, and showing the information required by
section 170(f)(12).

!

Other penalties may apply. See part O in the 2012
General Instructions for Certain Information Returns.

CAUTION

An acknowledgment containing a certification described in
box 5a or 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 instructions for box 5b) without a significant
intervening use or material improvement (as explained in the
instructions for box 5a) within 6 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 from
the charity stating the vehicle is to be transferred to a needy
individual for significantly below fair market value. Vehicles sold
at auction are not sold at prices significantly below fair market
value, and the IRS will not treat vehicles sold at auction as
qualifying for this exception.
The penalty for an acknowledgment relating to a qualified
vehicle for which box 4a must be checked is the larger of:
• The gross proceeds from the sale, or
• The sales price stated in the acknowledgment multiplied by
35%.
The penalty for an acknowledgment relating to a qualified
vehicle for which box 5a or 5b must be checked is the larger of:
• $5,000, or
• The claimed value of the vehicle multiplied by 35%.

Donor’s Identification Number
See part J of the 2012 General Instructions for Certain
Information Returns for details on requesting the donor’s
identification number. If the donor does not provide an
identification number, you must check box 7 because the
acknowledgment will not meet the requirements of section
170(f)(12) and the donor will not be allowed to claim a
deduction of more than $500 for the qualified vehicle.

Box 1. Date of Contribution
Enter the date you received the motor vehicle, boat,
or airplane from the donor.

Boxes 2a, 2b, and 2c. Year, Make, and Model of
Vehicle
Enter the appropriate information in each box. The following
table shows three examples.
Box 2a - Year

Box 2b - Make

Box 2c - Model

Example 1 car

2002

Ford

Explorer

Example 2 airplane

1964

Piper

Cub

Example 3 boat

2004

Larson

LXI 210

Cat. No. 39750N

Box 3. Vehicle or Other Identification Number

significantly increases the value. To be a material improvement,
the improvement cannot be funded by an additional payment to
the donee from the donor of the vehicle. Material improvements
do not include cleaning, minor repairs, routine maintenance,
painting, removal of dents or scratches, cleaning or repair of
upholstery, and installation of theft deterrent devices.

For any vehicle contributed, this number is generally affixed to
the vehicle. For a motor vehicle, the vehicle identification
number is 17 alpha/numeric characters in length. Refer to the
vehicle owner’s manual for the location of the vehicle
identification number. For a boat, the hull identification number
is 12 characters in length and is usually located on the
starboard transom. For an airplane, the aircraft identification
number is 6 alpha/numeric characters in length and is located
on the tail of a U.S. aircraft.

Box 5b. Vehicle To Be Transferred to a Needy
Individual for Significantly Below Fair Market
Value
Check box 5b if you intend to sell the vehicle to a needy
individual at a price significantly below fair market value or
make a gratuitous transfer of the vehicle to a needy individual in
direct furtherance of your organization’s charitable purpose of
relieving the poor and distressed or 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 sale for this
purpose is not limited to the gross proceeds from the sale. Skip
this box if the qualified vehicle has a claimed value of $500 or
less.

Box 4a. Vehicle Sold in Arm’s Length
Transaction to Unrelated Party
If the vehicle is sold to a buyer other than a needy individual (as
explained in the instructions for box 5b) without a significant
intervening use or material improvement (as explained in the
instructions for box 5a), 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 complete boxes 4b and
4c. Skip this box if the qualified vehicle has a claimed value of
$500 or less.

Box 5c. Description of Material Improvements or
Significant Intervening Use and Duration of Use

Box 4b. Date of Sale

Describe in detail the intended material improvements to be
made by the organization or the intended significant intervening
use and duration of the use by the organization. Skip this box if
the qualified vehicle has a claimed value of $500 or less.

If you checked box 4a, enter the date that the vehicle was sold
in the arm’s length transaction. Skip this box if the qualified
vehicle has a claimed value of $500 or less.

Box 4c. Gross Proceeds

Box 6a. Checkbox for Whether Donee Provided
Goods and Services in Exchange for the Vehicle
Described

If you checked box 4a, enter the gross proceeds from the sale
of the vehicle. This is generally the sales price. Do not reduce
this amount by any expenses or fees. Skip this box if the
qualified vehicle has a claimed value of $500 or less.

You must check the box to indicate whether you provided
goods or services to the donor in exchange for the vehicle
described in boxes 2a, 2b, 2c, and 3.

Box 5a. Vehicle Will Not Be Transferred Before
Completion of Material Improvements or
Significant Intervening Use

Box 6b. Value of Goods and Services Provided
in Exchange for the Vehicle Described

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 vehicle will not be transferred for cash, other
property, or services before completion of the use or
improvement. Also complete box 5c. Skip this box if the
qualified vehicle has a claimed value of $500 or less.
There is significant intervening use only if the organization
actually uses the vehicle to substantially further the
organization’s regularly conducted activities, and the use is
significant, not incidental. Factors in determining whether a use
is a significant intervening use include its nature, extent,
frequency, and duration. For this purpose, use includes
providing transportation on a regular basis for a significant
period of time or significant use directly relating to training in
vehicle repair. Use does not include the use of a vehicle to
provide training in business skills, such as marketing or sales.
Examples of significant use include:
• Driving a vehicle every day for 1 year to deliver meals to
needy individuals, if delivering meals is an activity regularly
conducted by the organization, and
• 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 conducted by the organization.
Material improvements include major repairs and additions
that improve the condition of the vehicle in a manner that

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 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 was donated. Pub. 561,
Determining the Value of Donated Property, provides guidance
for providing an estimate for the value of goods and services.

Box 6c. Description of the Goods and Services
If you checked “Yes” in box 6a, describe in detail the goods and
services, including intangible religious benefits, that were
provided to the donor. If the donor received only intangible
religious benefits, check the box.
An intangible religious benefit is one that is provided by an
organization organized exclusively for religious purposes and
which generally is not sold in a commercial transaction outside
the donative context.

Box 7. Checkbox for a Vehicle With a Claimed
Value of $500 or Less
If the vehicle has a claimed value of $500 or less or the donor
did not provide a taxpayer identification number, you must
check box 7. If you check box 7, do not file Copy A with the
IRS and do not furnish Copy B to the donor.

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Instructions for Form 1098-C (2012)