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Burg Boxster · 02-12-2007, 12:23 PM

Unless IL sales tax is different than mine (PA), you've got an advantage b/c it tells you he's not happy w/ the trade-in # they gave him. If he was, he would have taken the deal b/c then you only have to pay sales tax on the difference (new less trade value). On more expensive (higher valued) cars, it's hard to offset the difference and/or justify the hassle of selling it private party.

For instance, I recently was going to tried to trade in my wife's '02 Volvo S80 w/ 92K miles. The real t/i value was $7K. Since her car had to be ordered, I figured I had some time and would run a $40 ad on Autotrader to see what I could get. Found a guy who wasn't afraid of higher mileage cars and since it was in great condition, he really wanted it. I ended up 'dumping' it for $10K. Sure I lost the $490 sales tax advantage (7% x $7000) but picked up almost $2.5K net ($10,000 - $490 tax - $40 ad - $7000 t/i value).

So, do your homework and figure out the realistic t/i value he was probably offered for it (use NADA and KBB) as well as the PP value. Calculate what the tax saving would be for him if he took their t/i value. Add that to the t/i value and make him an offer somewhere between that and his asking price. This way, everyone should be happy. If he was smart (and since it's winter there too), he would've priced it there already.

Good luck!

02-12-2007, 12:23 PM	#11
Burg Boxster Registered User Join Date: Nov 2006 Location: In the garage... Posts: 1,732	You're in the drivers seat here my friend Unless IL sales tax is different than mine (PA), you've got an advantage b/c it tells you he's not happy w/ the trade-in # they gave him. If he was, he would have taken the deal b/c then you only have to pay sales tax on the difference (new less trade value). On more expensive (higher valued) cars, it's hard to offset the difference and/or justify the hassle of selling it private party. For instance, I recently was going to tried to trade in my wife's '02 Volvo S80 w/ 92K miles. The real t/i value was $7K. Since her car had to be ordered, I figured I had some time and would run a $40 ad on Autotrader to see what I could get. Found a guy who wasn't afraid of higher mileage cars and since it was in great condition, he really wanted it. I ended up 'dumping' it for $10K. Sure I lost the $490 sales tax advantage (7% x $7000) but picked up almost $2.5K net ($10,000 - $490 tax - $40 ad - $7000 t/i value). So, do your homework and figure out the realistic t/i value he was probably offered for it (use NADA and KBB) as well as the PP value. Calculate what the tax saving would be for him if he took their t/i value. Add that to the t/i value and make him an offer somewhere between that and his asking price. This way, everyone should be happy. If he was smart (and since it's winter there too), he would've priced it there already. Good luck!