If you don't want to donate your car because the tax deduction just isn't worth it, consider trading your old car in for a new car instead. This can make a lot of sense if you'd only get a tax deduction worth $500 for donating your car, but you could get $2000 towards a new car if you traded it in.
You won't be helping anyone but yourself and the car dealership, but the extra $1500 might well make you feel generous enough to make a cash gift to the charity instead.
Trade in Tips
1. First thing, go to the car wash! Clean your car inside and out very well. In fact, you may want to have it professionally detailed.
2. Car Value- Before you ever step on the lot you should do your homework. Check both the N. A. D. A. and the blue book value. Then move to local classifieds and see how similar vehicles are being priced. Take the time to print out any information you find about pricing and go to the dealership armed. Print newspaper ads, online quotes and anything else pertaining to vehicles like yours. If you are interested in top-notch research, you can call some of the ads yourself and see what their cars have sold for.
3. You have probably already considered comparison-shopping for the car you want, but did you ever think of comparing trade in offers from one dealership to the next? Even if you decide to use a dealership that did not offer you the best amount for your car, you can still use that information when negotiating. Look at it this way, the dealership is going to turn around a sell your old vehicle for a profit and you should get as much of that profit as possible.
4. Savvy- For some people it is helpful to bring along a streetwise friend to help them keep perspective when the sales pitch comes. You do not want to fall for the typical sales tactics like the car you want is already spoken for or the offer to include free undercoating. These are high pressure and underhanded sales methods.
5. Don't let the car dealership overestimate the repairs that are needed on your car. You might want to spend $100 or so to have a good mechanic check your car and see what, if anything, needs to be fixed, and how much it would cost. Don't get left making a questimate on a repair in the middle of your negotiations. And if you are going to make any improvements before the trade-in, make visible ones. Visible repairs will get you more money for your trade-in than hard-to-see ones.
6. Know the code. Car dealers write numbers in code that they don't want you to know. That way they can show you one set of information, and easily see their profits in the same glance. Look for the code for figures like their profit on your trade-in, the cost for repairs, and your ACV. AVC is the "actual cash value" of your car.
The code is not so difficult to crack. Numbers are replaced with letters of the alphabet. Generally it will be the first 10 letters, for example A=1, B=2 and C=3 all the way to J which equals 0. That means if you see something like BJJJ on the appraisal it translates to $2,000 in actual cash value for your vehicle.
Dealers do not hide this shorthand, in fact, they usually keep it in plain sight and once you know how to read it, you have the upper hand.
7. Trade in the car before the odometer rolls over to the next 10,000 increment. 139,000 is better than 140,000.
Pam Neely writes about donating a car to charity.
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