A donated vehicle can create more reporting work than a standard charitable contribution. When the claimed value is more than $500, the donee organization may need to file Form 1098-C and give the donor a written acknowledgment they can use for their tax return. The details you report depend on what happens next: whether the vehicle is sold, kept for significant charitable use, materially improved, or given or sold below fair market value to a needy individual.<\/p>\n
This guide walks through how to file Form 1098-C, including who files the form, what information to collect, the 2026 deadlines, and how to e-file it correctly.<\/p>\n
In simple words, Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes, is used by a donee organization to report a qualified vehicle donation with a claimed value of more than $500 to the IRS. Depending on what happens after the donation, Form 1098-C may report whether the vehicle:<\/p>\n
Not every donated vehicle falls under Form 1098-C filing requirements. According to the IRS, qualified vehicles include:<\/p>\n
Any donee organization must file Form 1098-C for each qualified vehicle with a claimed value of more than $500. File one Form 1098-C for each reportable vehicle, and don\u2019t combine multiple vehicle donations on a single form. Here are a few more filing requirements:<\/p>\n
Before you start filing any form, it is always best to gather and verify all the required information to avoid errors and prevent delays.<\/p>\n
Start with your organization’s details, including:<\/p>\n
Next, collect the details on donors:<\/p>\n
You also need information about the vehicle that was donated:<\/p>\n
The final part of the form depends on how your organization handled the donation. Collect records showing:<\/p>\n
With your records in place, the next step is preparing Form 1098-C and submitting it electronically.<\/p>\n
The very first step is signing in to your 1099Online account and then selecting Form 1098-C for the appropriate tax year.<\/p>\n
Then start adding your organization’s legal name, mailing address, Employer Identification Number (EIN), and contact telephone number.<\/p>\n
The next step is adding the donor’s legal name, mailing address, and taxpayer identification number (TIN).<\/p>\n
For the vehicle section, the IRS asks for enough information to identify the donation clearly. So you need to fill in the contribution date, year, make, model, and the applicable identification number, plus odometer mileage for a motor vehicle.<\/p>\n
Then you need to choose the option that reflects what happened to the donated vehicle.<\/p>\n
Answer “Yes” or “No” in Box 6a to show whether the donor received any goods or services in exchange for the contribution.<\/p>\n
Once you are done with adding all the data, go ahead and generate Copies B and C and furnish them to the donor within the applicable IRS acknowledgment deadline.<\/p>\n
Before you file with the IRS, go over the information entered in form carefully again, and if everything looks correct, submit it electronically (or when paper filing is permitted, mail it by the applicable deadline). Also, keep the filing confirmation and IRS acceptance record with your files.<\/p>\n
Now, depending on how the donated vehicle is handled, you’ll need to furnish the donor’s acknowledgment within 30 days of the sale or contribution. You’ll also need to file Copy A with the IRS by the applicable paper or electronic filing deadline.<\/p>\n
| Situation<\/th>\n | Impact on Form 940<\/th>\n | Employer Action<\/th>\n<\/tr>\n | |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Annual FUTA liability is $420<\/td>\n | Form 940 may still be required, but quarterly deposits generally are not.<\/td>\n | Pay the permitted balance with the return or deposit electronically.<\/td>\n<\/tr>\n | |||||||||||||||||||||
| Cumulative liability exceeds $500 in the second quarter<\/td>\n | A FUTA deposit is required.<\/td>\n | Deposit the accumulated amount by July 31.<\/td>\n<\/tr>\n | |||||||||||||||||||||
| State unemployment tax was required in multiple states<\/td>\n | Schedule A is required.<\/td>\n | Enter every state where you had to pay state unemployment tax.<\/td>\n<\/tr>\n | |||||||||||||||||||||
| Wages were paid in a credit-reduction state<\/td>\n | Additional FUTA may apply.<\/td>\n | Use the final Schedule A for the correct year.<\/td>\n<\/tr>\n | |||||||||||||||||||||
| Business permanently stopped paying wages<\/td>\n | A final Form 940 may be required.<\/td>\n | Select the final-return indicator.<\/td>\n<\/tr>\n | |||||||||||||||||||||
| Electronic filing is rejected<\/td>\n | The return has not been successfully filed.<\/td>\n | Correct the rejection and retransmit promptly.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n The paper filing deadline falls on March 1, 2027, because February 28, 2027, is a Sunday. Electronic filers have until March 31, 2027, to submit Form 1098-C to the IRS.<\/p>\n Avoid These Common Form 1098-C Filing Errors<\/h2>\nMany Form 1098-C filing issues come from incorrect reporting or missed deadlines. That is why taking a few extra minutes to review the return before filing can help you avoid corrections and IRS correspondence.<\/p>\n
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