Maybe you've heard, read or seen the ads. They are becoming increasingly prevalent, trying to coax you to donate your used car to charity and receive a tax break. But is it really worth it?

Donating your car can make monetary sense for both you and the organization you are donating to, but there are a few things you should consider first:

Don't assume that all organizations requesting donations are eligible to receive tax-deductible gifts. Ask for a copy of the organization's IRS Determination Letter, which verifies that the group is tax exempt. Keep in mind that churches need not apply for exempt status.

Make sure to ask the charity for a receipt and place an accurate value on the car donation. Use an official price guide for this. If the claimed value exceeds $500, you will need to complete and attach IRS form 8283 to your tax return. If the claimed value is more than $5,000, you'll need to obtain a written appraisal.

If you are merely trying to avoid the hassle of selling a car, donating can be a hassle too. If you are just interested in helping a good cause, keep in mind that charities rarely receive the vehicle's actual value. Sometimes they receive a flat fee and sometimes a small percentage, while a middleman walks off with the rest. Ask the charity about the specifics of their financial arrangements. If you do decide to donate your car, make sure you and the charity you chose don't get taken advantage of.