The letter grades are based on the total benefits percentage
The higher the letter grade, the greater the overall benefits compared to the value of the donate car.
Each of the three approaches produces a total benefits result (positive or negative) in dollars. Divide a total benefits result by the private sale value of the car, you get the total benefit percentage. The percentages become letter grades using this approach:
|Total Benefit Percentage||Letter Grade|
|Positive 20% or higher||A|
|Positive 5% to Positive 19.99%||B|
|Negative 5% to Positive 4.99%||C|
|Negative 20% to Negative 5.01%||D|
|Negative 20.01% or lower||F|
A “C” grade is acceptable
It means that the benefits to the charity are close to the cost to the donor. A typical cash donation to a charity would get a “C” grade — the overall benefit is pretty much a break even (it costs the donor the donated cash, the charity receives the donated cash). If the cash donor itemizes deductions, the overall benefits can obtain a “B” or an “A” depending on the donor’s marginal tax rate. See FAQs/ How are car donations different from cash donations?
Posted in: Car Donations