Should you donate a car or trade it in?

Sometimes you may want to donate an old car and find that the tax deduction just isn’t worth it. After all, no matter how good-hearted you have, when given the choice between getting a $ 500 tax deduction for donating your used car or earning a potential trade-in value of $ 2000 to buy a new car, everything practical leans towards going anywhere. you can get the most out of your old car. In this case, it may be in your interest to consider swapping a used car for a new one that meets your current needs rather than donating a car to a charity.

Some people may feel a certain guilt about this. And while it’s true that you’re not necessarily helping anyone but yourself and the car dealer, some of the money saved from your trade-in can still go towards a generous cash donation to a charity of your choice. So you can still do a good thing when you choose to trade in rather than donate a car. The difference is that trading in the used car, rather than donating it directly to a charity, can get you some extra money to use as a cash gift for your favorite charity that you can then claim as a tax deduction.

But, here’s the catch. You can usually donate an old car as is. However, when exchanging a car, several steps must be taken to ensure that you are getting worthy value. The car must be completely clean both inside and out. Consider a professional cleaning service if possible, and splurge on the deluxe cleaning package if you can afford it.

Do some research to find out the value of your car, both the NADA and the book value. Find out how much similar cars cost in your area. Use the Internet to search for car sales websites to find comparable cars in your region. Print the descriptions and what the owners ask for their old cars. Be sure to also browse the classifieds in your local newspaper. Maybe even call or email people who have sold similar cars recently to find out how much their old car sold for. Take as much documentation as possible to the car dealership to show them that no one will take advantage of you.

Compare with as many different dealerships as you can. Chances are, each dealer will offer you different trade-in values ​​for your vintage car. Of course, if the car you want is only at a particular dealership, this could be a sticking point, but even if that’s the case, be sure to check out other dealerships and find out what they are willing to give you for your why. Having this information on hand could be to your advantage when negotiating with your dealer for the car you want.

Be as smart as possible. It might not hurt to bring a smart friend to help you read to the car dealership. Car dealers are notorious for feeding people lines that are either half true or have no truth at all. For example, a classic car dealership strategy is to tell people that another buyer is interested in the car they want. Don’t buy this!

Don’t let the car dealer overestimate the necessary repairs on your car in the middle of negotiations. You may want a mechanic to check your car thoroughly before you start taking it to dealerships for trade-in quotes. Also, keep in mind that visible repairs are more likely to increase in trade-in value than internal repairs.

Break the code. Car dealers often use codes for numbers that they don’t want you to recognize. This is done so that the dealer can show you information and not worry about you translating scribbles or shorthand on the document stating your profit on the trade-in, the cost of repairs, and the ACV (actual cash value) of your car.

The code can be easily cracked once you understand that car dealers are replacing numbers with the first ten letters of the alphabet. Instead of $ 1234, you will see ABCD. A = 1, B = 2, C = 3, and D = 4. This goes all the way to J = 0. So on an appraisal sheet, if you see BJJJ, it translates to $ 2000.

Lastly, try changing your car before the odometer reaches the next 10,000 miles. 140,000 miles will give you better trade-in quotes than 150,000 miles.

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