Cash for Clunkers
Have you thought of taking advantage of the government's new Cash for Clunkers program? If so, here are a few things you may want to know before heading off to the car dealer.
Cash for Clunkers, or the Car Allowance Rebate System (CARS) as it is called by the government, is a credit of $3,500 or $4,500 for trading in an older, less fuel-efficient car for a new, greener car.
Other Cash for Clunker Facts:
Your trade-in vehicle must be less than 25 years old
Only purchase or lease of new vehicles qualify
Trade-in cars must get 18 or less MPG (some very large trucks and cargo vans have different requirements)
Trade-in cars must be registered and insured continuously for the full year preceding the trade-in
You don't need a voucher, car dealers will apply a credit at purchase
The program runs through Nov 1, 2009 or when the funds run out, whichever comes first
Your trade-in is required to be destroyed. So the value you negotiate with the dealer for your trade-in is not likely to exceed its scrap value. The law requires the dealer to disclose to you an estimate of the scrap value of your trade-in vehicle.
Even though your old car will be sold for scrap, if it does qualify for Cash for Clunkers you could get up to $4,500. You can trade-in both American and foreign cars, and the money you receive will NOT be considered taxable income (unless you're the car dealer). A condition of the Cash for Clunkers program is that your trade-in must have had car insurance for the past year.
For more information on the Cash for Clunkers program visit Cars.gov.