Goodwill and the Salvation Army won't take it. You left it out on the street for three days and no one took it. You added a "FREE!" sign and it was still there. Animals are starting to live on it. What to do??? Just like that car that you ran into the ground, there are times when something is simply not re-usable anymore.
The cop-out is to call waste management for a bulk disposal pick-up, and you know where that sofa will end up. Obviously, this is not the best solution.
I searched around and found some sites that do something called De-Manufacture. They take the parts apart, screws, etc., and save what can be used. In my opinion any recycling that involves the use of automotive transport (which ultimately means fuel and carbon emissions) and any type of machinery to flatten or artificially decompose a product reduces the green benefits of the recycling done by using energy anyway. For example, instead of having to recycle plastic bottles, why don't we just not use them in the first place. The upside of recycling though is, we are not contributing to the landfill problem.
Check out these links for more information:
You can also check your community for charitable organizations that will take worn sofas and do the repairs themselves.