THE new car donation law curbs drastically the economics of many car donations. Take the example of a prior year taxpayer taking a $2,400 deduction for a donated truck sold at auction by the charity for $375. Assuming a combined 20% federal and state tax rate for the donor, a donation is worth $480 in saved taxes - so the donor was better off donating the car than selling it.
NOW, this year, the deduction for the same car would be limited to $375 (the charity sold it for at auction), resulting in a $75 tax savings. Many would-be donors will just sell the car now; assuming they would also sell it for $375, they'd be money ahead to do so, but you should run the figures for your situation.
WHAT TO DO? I recommend that, in the above example, you consider a donate cash or appreciated securities to the Salvation Army. No charity makes better use of their resources.
OH, and just sell the car.