When you want to get rid of your old car, you can choose to either sell or donate it. It depends on what you want and the pros and cons of each choice especially where the monetary value of each option is considered.
If you pay taxes in the high tax bracket then donating the car may be the best option for you. If you also do not have a lot of time to sell it and do the paperwork that is involved then this is the better option. When you donate your old car to a charitable organization, the process is really simple. You call the organization and they will send someone to pick up the car and send you the tax deduction papers after. You can then use the paperwork when filing your tax returns or you may send them to your accountant and this saves you a lot of time. You will get a tax deduction of an average of five hundred dollars.
Another way of getting a larger tax deduction when you donate your old car is by donating to a charity that has a program where the charity uses the car for their own use, or they will fix it and then resell it or the organization will give the car to someone in their program for the person's use. In this case you can get the Kelly Blue Book value of your car deducted as the tax deduction. This kind of tax deduction can be upwards of a thousand dollars on top of what you would get on top of the average tax deduction of five hundred dollars.
If you are selling your old car, the main disadvantage is the time you will spend trying to get your car to sell. It can take weeks to sell your car and in this time period you will have to meet with potential buyers as they take the car for a test drive and look it over. You may also have to spend extra time and money to have it professionally cleaned and any mechanical problems and issues fixed so that you are able to sell it for a high price. You will then have to pay the taxes on the amount you will make after you sell your old car. The obvious advantages of selling your car is that you will get ready cash in your hand and this is the single most popular reason people opt to sell rather than buy. Some people opt to do a trade in as opposed to donating.
Donating is a better option than selling your old car because it will save you a lot of time, you do not have to refurbish or fix it; you can donate it as it is, the charity organization will arrange for the pick up and take care of the bulk of the paperwork so that you will have an easier time filing your tax returns. Sometimes you may get a larger tax deduction than the money you will make if you sell your old car.