As the end of the year approaches many taxpayers are looking to reduce their tax bite by making charitable contributions. One of the biggest contributions a taxpayer can make is to donate a used automobile. But if not careful, the value of a donated vehicle could be a lot lower than you think.

The rule

When you donate a vehicle, the value of your donation is either the fair market value of your vehicle when you donate it OR the value received by the charitable organization for your donation. Unfortunately, you do not get to choose the value of the donated vehicle. It all depends:

• If the organization either uses the vehicle or is in the business of using your vehicle to train others you can deduct the fair market value of the vehicle.
• If the charitable group simply resells your donated vehicle, your donation is limited to what the organization receives for your vehicle and NOT the usually much higher fair market value of the item.

What you should do

	Select the organization wisely. Make sure you select an organization that will either use the vehicle themselves or will use it to train others. Qualified organizations include groups that help single mothers obtain transportation to and from work or use the vehicles to deliver meals to seniors. Other organizations teach auto repair and body shop work to the unemployed. The cars then are given to other non-profits or needy folks. From the IRS perspective, a qualifying charitable use either; makes significant intervening use of the vehicle or, makes significant improvement to the vehicle that increases its value or, donates the vehicle (or sells it at a below market rate) to a needy person that helps further the cause of the organization.
	Research the fair market value. Prior to donating your vehicle go to a reputable source and estimate the value of your vehicle. Online resources like Edmunds.com and kbb.com (Kelley Blue Book) are two reliable sites to do this.
	Obtain the proper tax form. When donating your vehicle make sure the organization gives you a proper Form 1098-C at the time you provide your vehicle. Double check the value assigned to your donation form to ensure it meets or exceeds the estimated fair market value of your donation.
	Sell the vehicle and donate the cash. If you cannot find a charitable organization that will allow you to maximize your fair market value deduction, consider selling the vehicle and then donating the proceeds. There are problems with this approach, however. First, take care that you do not create an unplanned taxable capital gain with the transaction. Second, take into account any sales taxes that go with the transaction as this may conceivably reduce the amount you receive for your vehicle.

Tips to keep you and your pocketbook happy this holiday season

With Black Friday just around the corner, now is the time to plan or review your holiday budget. If you're not careful, holiday spending can create a financial burden that lasts well into the new year. Consider these ideas to help you make the most of your holiday spending:

	Make a Budget: set a realistic amount of how much you wish to spend this holiday season. Remember to include food, gifts, transportation, and clothing costs.
	Shop With a List: make a list of who will be receiving gifts from you and include how much you want to spend on each person. Come up with gift ideas before you go shopping and then try to stick to your list.
	Pay With Cash: don't spend money you don't have. Shop with your budgeted cash and leave the credit cards at home. If you must shop with a credit card, use a low-interest card and use it judiciously.
	Comparison Shop: before you go shopping, check catalogs and the internet to compare prices on gifts you plan to buy.
	Consider Alternative Gifts: gifts don't have to be expensive to be meaningful. Consider making meals, providing baked goods for family and friends, spending time with a friend doing an activity you both enjoy, or volunteering your time to baby-sit or dog-sit.

Given all the data breaches at major retailers and the identity theft problem at the IRS, it is recommended that you check your credit reports at least once a year. Credit reports often have errors in them and this quick check-up can be the first indication that some form of identity theft has taken place on your account.

The good news is that each of the major consumer credit reporting agencies is required by law to provide you with a free report once a year. A web site has been set up specifically for this purpose. Here is the information to select your free report from the three major credit reporting agencies; Experian, Equifax, and TransUnion.

Free Annual Credit Report

Telephone:	1.877.322.8228
Web site:	www.AnnualCreditReport.com
Via mail:	(fill out the online form and mail it to the following address) Annual Credit Report Request Service PO Box 105281 Atlanta, GA 30348-5281

Listed here are the three major credit agencies and how to contact them directly.

	TransUnion Telephone: 1.800.888.4213 Web site: www.transunion.com Via mail: 2 Baldwin Place PO Box 2000 Chester, PA 19022
	Equifax Telephone: 1.800.685.1111 Web site: www.equifax.com Via mail: Equifax Credit Information Service P.O. Box 740241 Atlanta, GA 30374-0241
	Experian Telephone: 1.888.EXPERIAN (397-3742) Web site: www.experian.com Via mail: P.O. Box 9532 Allen, TX 75013

But be careful, each agency will try to "upsell" you into additional paid services. If you find problems work through the credit bureau's process to correct the error. Also place fraud alerts on your credit agency account should you be subject to any kind of identity fraud.

As the end of the year rolls around, if you have not already done so, now is the time to plan for contributions into your retirement accounts in 2015. While Traditional IRA and Roth IRA plan limits are unchanged versus 2014, please note the contribution increases in 401(k), 403(b), 457 and SIMPLE IRAs.

Don't forget to take advantage of any matching programs offered by your employer as you review your various funding levels.