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Your car donation is tax deductible, up to the full fair market value of the vehicle, provided it is made to a legitimate 501(c)(3) charitable organization. Be sure to check that the organization to which you donate your car has current tax-deductible status from the IRS. Getting tax deductions on car donations is a very helpful way to do good for others. When you do your tax returns for the year in which you donate your car, itemize car donations along with any other duductions.
Fair market value is define as the price an interested but not desperate buyer would be willing to pay and an interested but not desperate seller would be willing to accept on the open market assuming a reasonable period of time for the agreement to occur. It may be tempting to overstate the fair market value of a vehicle on a tax return, but this can get you into trouble with the IRS. The Kelley Blue Book is a good place to start.
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