If you are buying a new car, are you wondering what to do with the old one? You actually have a number of options, some of which have tax implications and some of which don’t. These options include trading the car in with the dealer, selling it to a third party, donating it to a charity, gifting it to someone, or even keeping it as a second car. Here are the details for each. Note: This article does not discuss in detail how to treat the disposition of a vehicle used for business.