In my area the BMW dealers have minimal discounts on leases, so my option is to sell on Carvana or alike and lease out of state. Out of state brokers don’t want a trade. The issue is the offers are really low on those sites and put me way underwater. If I trade my BMW on a purchase I get tax credits and good value on trade but will be in the same situation in 3 years. This is my first BMW and apparently they don’t hold value like my other cars I have owned. Seems like a good time to lease due to discounts, loyalty and low MF. Any other ideas?
BMW leases tend to be cheaper because they inflate the residual value. At the end, that means the vehicle is never worth anywhere near what the buy out is.
A BMW dealer isn’t going to give you any better value on the trade.
The tax implications, however, are worth keeping in mind.
Why not just ride out your current lease rather than set a bunch of money on fire trying to grab a few incentives?
What state are you in? you still might be able to get the tax credits by selling privately. You just have to claim them on your own instead of getting the credit at the dealer.
Note that cars do not automatically self-destruct when the warranty expires.
Also…
~18 months ago I put comprehensive MBI coverage for 5 (additional) years/100,000 (total) miles on a 2011 INFINITI with 74,xxx miles for $1,495. https://www.penfed.org/auto/extended-warranty
You’ll see that newer vehicles are even less expensive to cover.
Does the risk of repairs on the current car outweigh the financial pitfalls of rolling negative equity into another vehicle? More than likely the answer is no. Will this car that is about to be out of warranty soon require any major repairs soon? Probably not assuming it’s been well cared for. I guess you have to ask yourself…“how bad do I want this new car?”
Sorry, but what tax implications? I just ended up selling a vehicle to Vroom for a pretty steep loss - does that translate to something I should be doing specially for next year’s taxes?
If there’s a particular link or type of tax y’all could point me to, that would be much appreciated!
I don’t know what state you’re in. But in Texas, where I’m located, if I trade in a vehicle, and the dealer gives me $12k for the trade (assuming it’s a purchased vehicle, not a leased vehicle) and my new vehicle is $20k…I only pay sales tax on $8k. The difference between the 2 values. In Texas, we are taxed on the entire value of the new vehicle. Even if we lease it. So if I trade in a vehicle that I own I am only paying sales tax on the difference. You have to know the tax ramifications in whatever state you’re in.
