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Donate your old car and save money on taxes

Donate your old car and save money on taxes -- You'll get a bigger deducation if the charity uses your car rather than sells it. Either way, be sure to follow the rules and save the paperwork.

Looking to make a smart financial move before the end of the year? Try donating a car you no longer want, need or use.

Donating a vehicle to charity may net you a hefty tax deduction. However, you need to meet certain requirements to qualify for the deduction.

If you're feeling philanthropic, start by deciding on an IRS-approved charity you'd like to benefit. Just remember that the charity you select must be an IRS-recognized 501(c)(3) for you to get a tax deduction.

Consult IRS Publication 4303, "A Donor's Guide to Vehicle Donations," as well as IRS Publication 78, which lists qualified charities. (Religious groups aren't listed, but they qualify as well.)

To go the extra mile, also check the Better Business Bureau's National Charity Report Index. It rates charities based on 20 different accountability standards.

Once you know a given nonprofit meets IRS qualifications, contact the charity to arrange the donation. Most will send someone to pick up a donated vehicle. Be sure to ask how the charity will use the car. Will it simply sell the car at an auction, as is commonly done? Or will the charity actually keep the car and use it -- say, to transport kids or senior citizens?

The distinction is important because the IRS has gotten stricter about deductions for donated cars.

For cars that will simply be sold for cash, you are allowed to deduct only the charity's sales price of the car--not the vehicle's market value. Your deduction is further limited by your marginal tax rate. For example, assume a charity sold a vehicle you donated for $3,000. If you were in the 28% tax bracket, your deduction would be capped at $840.

But you can deduct the full market value of vehicles that will be used by a charity for things like deliveries. So if you give away a car that will be used by the charity, and it has a fair market value of $5,000, your deduction will be $1,400, assuming a 28% tax bracket.

Regardless of how the car is to be used, be sure to get a receipt from the charity. If the charity sells your donated vehicle, it is required by law to send you a notice of the sale within 30 days advising you of the car's sales price.

Once you've donated the car, contact your auto insurance provider to drop the vehicle from your policy. ( Insurance.com.)

5 money-saving tips for pensioners

5 money-saving tips for pensioners - With the cost of living set to rise, the older generation faces a difficult winter. Here are five tips to cut everyday outgoings.

Inflation is a deadly enemy for pensioners, who often have fixed incomes or rely on interest from savings to make ends meet. So they won't have welcomed the latest inflation projections from the Bank of England.

The Bank said the official measure of rising prices, the consumer price index, would increase to around 3.6pc by the end of the year – and the "real" rate of inflation for pensioners is thought to be much higher than for the general population.

According to the "Silver RPI" from Age UK, the charity, the real inflation rate for the over-75s is 4.1 percentage points higher than the regular retail price index.

Here are five tips to help pensioners cut their outgoings without affecting their standard of living.

1. GET THE BEST ENERGY DEALS WITHOUT GOING ONLINE

Gas prices are likely to rise by 10pc over the coming months, the Bank of England said last week. Pensioners tend to be particularly hard hit because of the time spent at home.

Internet surfers are used to shopping around for the best tariffs on price comparison websites. Many pensioners have not gone online, but you don't need the internet to get the best deal on gas and electricity.

Some price comparison companies offer the service by telephone. One is Energyhelpline (0800 074 0745), which is accredited by Consumer Focus, the official watchdog. An Energyhelpline adviser said the phone-based service offered access to all the tariffs available online but callers had the additional benefit of receiving individual advice.

You may qualify for a grant to improve your heating system and home insulation if you are of state pension age and receive certain state benefits, including the pension credit. The scheme is called Warm Front and is available to those living in England.

But it's worth getting your skates on – the Government has announced the scheme's abolition, although Warm Front said it was still taking new applications and all existing ones would be completed.

2. SWITCH TO A WATER METER

There are two ways to pay for water and sewerage: a flat charge based on your property's rateable value or paying for what you use via a water meter.

Small families in big homes are likely to be better off having a meter installed - something that applies to many pensioner households. As a rule of thumb, if you have more bedrooms than occupants, a meter is likely to be cheaper.

There is no charge for having a meter fitted and you can switch back to the unmetered charge at any time within 12 months if metering turns out to be more expensive. If a meter cannot be fitted, water companies can offer an alternative unmeasured tariff which may be lower than the current bill.

If you use a lot of water because of a medical condition and you also receive benefits such as pension credit, you may be able to pay a lower water bill under the WaterSure scheme. Contact your water company for details.

3. CHECK YOUR TAX CODE

Millions of people were told earlier this year that they might have been paying too much or too little tax when HM Revenue & Customs admitted that a new computer system was bringing errors to light.

Rob Durrant-Walker, tax manager at UHY Hacker Young, the accountancy firm, said pensioners were especially vulnerable as they often had multiple sources of income, which each had to be coded correctly. "We have dealt with large numbers of pensioners on modest incomes who are owed money by HMRC due to processing errors," he said.

The Low Incomes Tax Reform Group (LITRG) has said that at least seven different errors could affect pensioners' coding notices. The mistakes could mean paying as much as £108 extra in tax each month.

It's important to check that HMRC has got your personal allowance right – one common source of errors, according to the LITRG. In the current tax year, the personal allowance is £9,490 for people aged 65-74 and £9,640 for anyone aged 75 or more, compared with £6,475 for those aged 65 or less.

Your tax code should start with the letter P if you are aged 65-74 and with Y or T above 75. In both cases the number, when multiplied by 10, should give your personal allowance.

The Chartered Institute of Taxation said one common sign of an incorrect tax code was receiving multiple coding notices when you have just one private pension.

Contact the Revenue or ask your adviser if you think there has been a mistake. Tax Help for Older People (www.taxvol.org.uk) may also be helpful.

Don't forget council tax. If you live on your own there is a 25pc discount; you may not have to pay at all if your house is empty, if, for example, you are living permanently in a hospital or care home.

The Disability Reduction Scheme can reduce your bill if your home has special features to enable a disabled person to live in it. Council Tax Benefit, meanwhile, can pay some or all of the bill but it is means-tested and you will normally need to have less than £16‚000 in savings. Contact your council or the Citizens Advice Bureau for details.

4. COVER ALL THE BASES WHEN BUYING INSURANCE

As there are several companies specialising in insurance for older people, it's tempting to think that they will always offer the best deal to pensioners. But it may be worth trying the mainstream insurers as well.

"Don't favour specialists," said Will Thomas of Confused.com, the comparison service. "While some car insurers specialise in over-50s cover, it would be ill advised to assume that they'll automatically provide the best price."

Most travel insurers increase prices at five-year intervals once you reach 65. "If you are on the cusp of these age bands (65, 70, 75, etc), obtain quotes from companies that place you in the lower category," advised Staysure, the over-50s insurer. "Prices can double from one category to the next so it pays research a few providers."

If you have any medical conditions, look for companies offering free cover for what they deem to be "minor" conditions, it added.

5. GET FREE EYE TESTS AND PRESCRIPTIONS

Everyone aged over 60 gets free eye tests and prescriptions. The annual flu jab is free once you reach the age of 65. You may qualify for help towards dental treatment‚ glasses and travel costs to hospital if you are receiving certain benefits, including the guarantee credit part of the pension credit. ( telegraph.co.uk )

More Money for Struggling Homeowners

More Money for Struggling Homeowners - A new federal program is offering aid with a sweet kicker: It doesn't need to be repaid.

For the roughly four million homeowners who have fallen behind on their mortgage payments, the federal government is offering yet another remedy: free money to catch up on their loans.

The effort, called the Emergency Homeowners Loan Program, is the latest in the federal government's efforts to slow down the flood of foreclosures a necessary step to a meaningful recovery in the housing market, says a Department of Housing and Urban Development official. For people who have lost their jobs, the $1 billion program offers loans of up to $50,000 that don't actually need to be repaid, if applicants meet certain requirements.

The goal, says HUD, is to offer short-term aid to people who look like they'll be back on their feet soon. But critics say the loans may leave homeowners worse off in the long run. "This is a short run band-aid, a modest attempt to grapple with the severity of the situation," says Stuart Gabriel, director of the Ziman Center for Real Estate at the University of California, Los Angeles.

Rolled out by HUD and the nonprofit housing advocacy group NeighborWorks America, the program is making loans with far better terms than anything on offer at a local bank. The loans are interest-free. Payments go directly to the lender for a portion of the borrower's monthly mortgage, including missed payments or past due charges. And when the assistance period -- which runs for up to two years -- ends, 20% of the loan is forgiven with each passing year. In other words, for qualified borrowers who stay in their home for at least five years after the assistance period and who don't fall behind on their mortgage again, this money doesn't have to be paid back.

But some critics say that's where help for consumers ends. By taking this loan, borrowers risk falling further into debt. If they sell their home before the entire loan is forgiven, they'll be on the hook for the remaining amount. The same holds true if they fall behind on their mortgage payments again: they'll need to repay the remaining balance of the loan when they sell or refinance their home. Separately, borrowers aren't required to have equity in their home to receive this money, so someone who has to repay this loan risks owing more on the home later than they do now. For homeowners who are significantly underwater now, the loan may only delay foreclosure, says Gabriel. While the limit each person will get is up to $50,000, loans will average about $35,000 per person, according to NeighborWorks America.

Others say the program doesn't go far enough. The loans will be made available to around 30,000 applicants -- "a drop in the bucket," says Stu Feldstein, president at SMR Research, a housing and mortgage research firm. It's helpful, he says, but it won't be enough to seriously boost the ailing housing market. Roughly 4 to 4.5 million borrowers are behind on their mortgages by at least 90 days or are in foreclosure, accounting for roughly 8% of all mortgages. Housing analysts say the loss of income is the primary reason why borrowers are in danger of losing their homes. Those behind the program counter that the help will be significant for some. "If you are one of those 30,000 people, I think you should be very excited to get this help," says a NeighborWorks America spokesman.

The program started last week and will take applications through July 22. Many experts say it's still too early to say it will be successful, and so far federal assistance programs haven't impacted a significant number of borrowers. The government's Home Affordable Modification Program, which started in 2009 and was projected to help up to 4 million homeowners lower their mortgage payments has so far only permanently helped around 700,000 homeowners. To be eligible, homeowners must have lost income and be at risk of foreclosure due to involuntary job loss, underemployment or a medical or other economic condition; details on the application process are available online through NeighborWorks America. ( SmartMoney )

Australia shock at asylum boat tragedy off Indonesia

Australia shock at asylum boat tragedy off Indonesia - Australians have been expressing shock after a boat filled with asylum seekers capsized on its way from Indonesia, killing at least seven people.

Some 57 people, thought to be from Iran and Afghanistan, were rescued but many others are still missing.

Immigration Minister Chris Bowen said he expected no more survivors.

The tragedy has reopened the long-running debate in Australia about the fate of asylum seekers trying to reach the country by boat.

Prime Minister Julia Gillard had tried to tackle the issue by agreeing a deal with Malaysia whereby hundreds of the asylum seekers would be processed there.

But Australian courts ruled that her proposals were illegal, and she was forced to abandon them.

Thousands of asylum seekers try to reach Australia by boat every year, many paying people-smugglers in Indonesia to transport them.

Australia asylum

Irregular maritime arrivals (IMAs) in 2010: 134 boats carrying 6,535 people
IMAs up to 2 Nov 2011: 48 boats carrying 2,910 people
As of 27 Oct 3,922 IMAs detained on the mainland, 855 on Christmas Island

Source: Australian Department of Immigration

The boat that capsized on Tuesday was sailing from the port of Cilacap along the coast to Kupang in West Timor province, a common transit point used by people-smugglers.

It went down in bad weather off Java. Indonesian rescue officials said seven bodies had so far been recovered and 57 people had been saved.

But they expected the death toll to rise because the asylum seekers had been crowded below deck.

Mr Bowen was pessimistic about finding any more survivors, telling ABC News: "I think that we can tragically assume that many, if not most, of those people who are missing will be very difficult to recover alive."

He once again made a plea for opposition politicians to support the Malaysia swap deal, saying it would deter people from getting on to boats.

The main opposition party wants to reopen a detention centre on the Pacific island of Nauru, a policy that the governing Labor Party bitterly opposed while in opposition. ( bbc.co.uk )

disaster response failed

disaster response failed - A lack of preparedness for a disaster and failures in the response to it exacerbated the effects of the nuclear accident at Japan's Fukushima plant in March, a new report says.

The government-commissioned study said plant operators and regulators had failed to adequately anticipate a huge tsunami and its likely impact.

The interim findings were issued by an independent panel set up in May.

More than 20,000 people were killed when an earthquake and tsunami struck.

Tens of thousands had to be evacuated as radiation leaked into the atmosphere, sea and food chain.

The six-reactor Fukushima Daiichi nuclear plant was badly damaged by the earthquake and tsunami, with blasts occurring at four reactors after the cooling systems went offline.

Last week, the authorities declared the plant had been stabilised, but said it would take decades to dismantle it completely.
Lack of precautions

The panel said its aim was not to apportion blame for the disaster, but to learn why the accident happened in the way it did, AFP news agency reported.

Tokyo Electric Power (Tepco), the company which operated the plant, did not "take precautionary measures in anticipation that a severe accident could be caused by (a) tsunami such as the one (that) hit... Neither did the regulatory authorities," the report said.

It also accused Tepco of failing to "incorporate measures against tsunamis exceeding the design basis. This indicates the limit of voluntary safety measures".

Further, the government's nuclear regulatory body "did not require Tepco to take specific measures, such as additional construction, after they received simulation results from Tepco in 2008 and early in 2011 regarding the impact of tsunamis on their facilities".

Tepco's own report on the disaster, by contrast, said there was no way it could have been prepared for a 9.0 magnitude quake and huge waves that triggered meltdowns and explosions at the plant.

The panel's report said the situation was also made worse by;

delays in relaying information to the public
managers' lack of knowledge of procedures to deal with emergencies
poor communications - between the workers and the government, among the workers themselves, and between government bodies.

"Collection of accurate and most up-to-date information is a pre-requisite for timely and appropriate decision-making. This issue, together with the need for providing information to the nation, is of a major concern," it said.

It said Tepco staff at the plant were not trained to handle emergencies like the power shutdown that struck when the tsunami destroyed back-up generators, AP news agency reported.

Staff also misunderstood problems that arose with the cooling systems for reactors 1 and 3.
'Unprepared'

The 506-page report was based on interviews with more than 450 people, including government officials and plant workers.

The 12-member panel is headed by Yotaro Hatamura - an engineering professor at Tokyo University who specialises in the study of failures - and includes seismologists, former diplomats and judges.

It was set up in May by then prime minister Naoto Kan, and is expected to issue its final report in mid-2012.

In an earlier report, submitted to the UN nuclear watchdog, the Japanese government said it had been unprepared for a nuclear accident on the scale of the one at the Fukushima plant. ( bbc.co.uk )