asking for someone who a 24-year-old female. she just started grad school last month.(having graduated from college earlier this year)
she had a part-time job in 2025 and made about $10000.
before leavign for grad school in another state, she donated her old junky car to a well-known charity. The charity just sent her a 1098-c form and said her car got sold for $750 at auction. They thanked her for her donation. Prior to donating it, she checked with around 6 local places that bought junk cars. Most offered $300, but two offered $600. She decided to donat because it seemed like a worthy cause.
Anyway… when she does her taxes next year, what are the implications of including thie 1098-c form for the $750 donation?
Thanks!
college kid donated junk car and got a 1098-c form documenting $750(what the charity sold the car for). if she makes only $10k in 2025, how does she include this 1098-c?
byu/Ok_Cupcake375 inpersonalfinance
Posted by Ok_Cupcake375
11 Comments
Probably nothing. She made nothing so she won’t itemize deductibles
There’s no tax on 10,000 if she’s taking the standard deduction.
If she has enough donations that it’s more than the standard deduction, she won’t pay tax either.
So not much point worrying about it
[deleted]
College kid does NOTHING. 1098-C form is required to be filed by the recipient of the donation and the recipient is required to send a copy of the form to whomever made the donation. Because the college kid only made $10K, they will be due a full refund of any taxes paid and, because they owe no taxes, they will receive no benefit for the donation. If they made enough to owe any tax liability, the $750 donation could be used to lessen their AGI and, therefore, could lower their tax liability.
She’ll have to report the 1098C on her schedule a, itemized deductions. It’s a charitable deduction and since the car sold for more than $500, she gets a 1098.
But it will be a moot point because, the standard deduction is $14,000, so it’s just a minor annoyance.
There are no implications. Donations are only relevant when itemizing your deductions. She will take the standard deduction ($15,750) and her taxable income will already be 0. So she can simply throw away the 1098-c.
I made this same mistake many years ago. Lesson learned that if you actually want a financial incentive, do the “cash for clunkers” or whatever and just get cash instead… If they still do that kind of thing.
(Wasn’t a huge loss for me since it was a massive rusted junker and I just wanted it gone… So free tow I guess.)
I wouldn’t worry about it either way but she might be able to get it back in a refund. I kinda doubt it though because she likely didnt pay enough taxes for it to matter.
It only matters if she is itemizing deductions, which seems very unlikely.
Others are right that there would be no tax on $10,000; however, grad school stipends, grants, scholarships, other benefits, etc, may also impact her taxable income. If that is the case, and she ends up with taxable income, and she has state income tax, and that state allows charitable deductions without itemizing, she may be able to use it at the state level.
Consult a tax professional and/or the school on what her school-related tax implications will be this year
Shouldn’t have donated grandmas car that was worth $1500 on Craigslist for nothing .
Which charity? Hopefully not karsforkids, they are far from a worthy cause