Here are some things to consider when it comes to your trade-in. Since you pay the sales tax on the difference between the price of your new car and the trade-in value of your used car, you need to do some homework. For instance, in Florida, if you buy a car for $25,000 and the dealer gives you $10,000 for your trade in, you would pay 6% in taxes, or $900. For a total of $15,900 (figuring $25,000 - $10,000 + $900). Now, let�s say that you sold your car through the newspaper partner & The Auto Dealer for $12,000. Now when you buy the car at the dealer for $25,000 plus the sales tax, $1500, your car will be $26,500. Subtract the $12,000 from your private sales and the price of the car is now $14,500. You just saved yourself $1500! Of course this is only possible due to the fact that you were able to sell your vehicle privately for more than the dealer would offer. If you aren�t able to get more for your car than the dealer offers, then go ahead and trade in at the dealership, because you�ll benefit by the savings in sales tax.