Overhaulin'

Sell old car or transfer ownership?

My dad has an old 92 Cadillac.  He's a recipient of SSI and SS income. He can't sell his car since it will be considered income which will interfere w/ his monthly SSI/SS checks.  I was thinking of transferring ownership to my name and avoid paying taxes.  Afterwards, donate it to a charity to benefit my tax returns.   - is tranfering owership finanically beneficial vs. the headache i have to go through at dmv? - will it be beneficial period.  i earn over 90K.  My random "donations to charity" i've made does not seem to benefit anymore. - This whole plan - is it unethical? afterall i'm trying to go around the system trying to get something out of it. - does this have any implications on my father's situation? Btw - the car does drive.  market value is around $1.5K.  i would sell it but i would like to get rid of it asap. few things i should mention. My assumption was based on what the social worker told me. She specifically said "any income will go against his SSI payment". He's also not only 62. he gets ssi/ss b/c he's disable. i'm also from NJ. i'm sure laws differ state to state. thanks

Public Comments

1. I THINK YOU ARE WRONG ABOUT HIS SSI/SS BEING EFFECTED BY THE SALE OF HIS CAR. THE MONEY HE BOUGHT THE CAR WITH IS ALREADY SPENT MONEY THAT HE PAID TAXES ON WHEN HE BOUGHT IT ORIGINALLY. NOW THAT HE IS SELLING IT I AM SURE HE IS SELLING IT AT A LOSS FROM THE ORIGINAL PRICE SO THERE IS NOW GAIN. I HAVE NEVER HEARD OF ANYTHING LIKE THAT EFFECTING A PERSONS SSI/SS. RECHECK YOU INFO.
2. If your father has worked and paid into Social Security long enough, he was eligible for Social Security benefits while also receiving SSI. Retirement benefits can be paid to people age 62 or older and their families. Generally, the more income he has, the less your SSI benefit will be. If your father's countable income is over the allowable limit, he cannot receive SSI benefits. Some of his income may not count as income for the SSI program. (Specific questions can be answered by calling the Social Security Administration toll free number: 800-772-1213, 7 a.m. to 7 p.m., Monday through Friday.) Concerning his '92 Cadillac, the sale of his personal property would not affect his SSI benefits if he sells it for a loss. (While all capital gains are taxable and must be reported on your tax return, only capital losses on investment or business property are deductible. Losses on sales of personal property are not deductible.) If you decide to transfer the title and registration into your name, the car will become your personal property. You could check out http://www.state.nj.us/mvc/index.htm for insight to transferring ownership in the state of New Jersey. But, remember there are tax implications to consider. According to the IRS, the difference between the amount for which you sell the car (capital asset) and your basis, which is usually what you paid for it, is a capital gain or a capital loss. You have a capital gain if you sell the asset for more than your basis. You have a capital loss if you sell the asset for less than your basis. (Your basis is generally your cost plus improvements. IRS requires keeping accurate records that show your basis. Your records should show the purchase price, including commissions; increases to basis, such as the cost of improvements; and decreases to basis such as depreciation.) Should you re-consider donating the vehicle to a charity of your choice, check out, Publication 4303, “A Donor’s Guide to Car Donations,” on the IRS website. There it explains all the things to consider, such as which charity to choose, the steps you need to take, and whether you or your father can even get a tax benefit. Selling the '92 Cadillac for your father might be the simpliest route. Getting the best sales price will, however, take a little patience and persistence. Be strong! Don’t let the used car dealer haggle you down, especially if the condition is decent and the engine is still running smoothly for its age. Good Luck!
3. If he sells the car it will not efect his SS or SSI
4. I don't know about his SSI and SS. But he can give the car to you as a gift. As long as the car is worth less than $12,000, there's no taxes involved. Once the car is yours, you can drive it, sell it, donate it, or do whatever you want with it. And no, there's nothing unethical about you receiving a birthday present and then selling it to someone else.