When an old car stops running, sometimes it's just better to scrap it rather than trying to fix it. Junking a car or donating it to charity are two ways to get a clunker out of your driveway and out of your hair, and possibly make some money doing it. Between donation and junking, which is the better option? There are several factors to consider when deciding between the two.
Cash or Tax Benefits
Many people walk away from junking their cars disappointed with the cash they received. A common mistake they make is trying to measure the price against what others are selling used automobile parts for. When selling your used automobile parts to a shop, remember that they have to turn a profit, which means you don't take 100% of the cut.
When donating a car, however, you don't receive any cash. Rather, you get a tax receipt to claim on your new tax return. This is typically a set price depending on the charity you're donating to. You won't earn as much in the end, but at least your car will be going to a good cause.
Another thing to keep in mind when junking your car for parts is that not all vehicles are equal. Some cars and trucks have more useful and expensive parts. Do some research about your specific car and which parts are still good. You might find that you can get a better deal if you sell the individual parts rather than scrapping the whole thing at once.
When donating your car, though, the make and model don't matter. However, some charities require that your car must be able to start or drive. You certainly can't donate your car in pieces.
Time and Money
Junking your car might cost you money up front. Some scrapyards will charge a fee to tow your vehicle away. This will usually come out of the amount they pay you for your used automobile parts.
When donating a car, you'll rarely have to pay a tow fee. However, you may have to fill out a lot of paperwork and spend more time meeting with the charity representatives to relinquish your car.
Before you decide to call a charity or a junkyard like Southwest Auto Salvage about your clunker, make sure you compare the costs and benefits. After all, you should make the most out of your bad clunker situation.