Hurricane Katrina and Rita brings new hazards to the used car market, not only in the Gulf States region affected by floodwater, but across the nation as well.

The risk of buying a vehicle with flood damage goes up significantly and along with high demand and low volume, it is likely the price will also increase for used cars in the affected market area.

While a vast majority of the vehicles will be considered a Total Loss by insurance companies and scrapped, there are still thousands that will be back in the market place for resale purposes.

Wholesalers may purchase moderately damaged flood vehicles and sell at auctions across the country, leaving unsuspecting buyers at risk of purchasing a vehicle that has been damaged by the recent hurricanes.

Water damaged vehicles can be one of the most serious and costly types of damage. The long-term effects of corroded electronic parts and wiring can be devastating and almost impossible to correct and repair.

Here are a few tell tale signs and basic tips consumers can take to minimize the risk of purchasing a vehicle with flood damage.

Unless cleaned up properly, flood damage will leave grass and debris around the radiator, underneath around the frame, front and rear suspension components, etc.

Waterlines may be visible in the engine comprtment, rear firewall area, and even inside door pockets of the door panels and interior trim areas.

Mildew smell inside due to wet carpeting and padding underneath the carpet.

Inspect connectors and wiring for signs of corrossion

Rusted bolts and metal components, particularly underneath where water has been standing.

Inspect for windows fogging up on the inside after the vehicle has sat overnight, this is an indication that there may be water underneath the carpet and or carpet padding.

Inspect trunk area for waterlines, corroded connectors and wiring.

With a keen eye and a little knowledge you can minimize the risk of spending thousands of dollars on a vehicle that has potential long term effects by water damage.

About the Author: Jerry Christopher/Owner http://www.usedcarwise.com offers a new and innovative training course teaching the average consumer “How To Buy A Used Car The Right Way”

Source: www.isnare.com

Technorati Tags: automotive, autocare, auto care, car care, auto repair

You ve heard it a hundred times: That shiny new car your buddy just bought? It doesn t really cost him anything. He writes off the car as a tax deduction.

Your first thought is usually, That can t be right. Your second thought is, I got to figure out how to enjoy that loophole.

But what does the law say? And what are the rules for writing off vehicles? It turns out that you can write off the cost of buying and using a car if you re self-employed and use your vehicle in your business. Specifically, you can probably deduct the business portion of your vehicle expenses on your business tax return.

But this deduction is trickier than most people realize. Here s the first big thing that goofs many people up. You need substantiation to prove your business use. Ideally, in fact, the Internal Revenue Service wants you to keep a log of your business miles, your commuting miles, and your personal miles.

With this information, you can then either deduct an amount equal to the business miles times a standard per-mile rate of roughly $.35 or $.40 a mile (depending on the year) or you can deduct the percentage of your vehicle expenses equal to the percentage that your business miles represent.

Note that only your business miles and not your commuting miles or personal miles are deductible.

For example, if your business use equals 5,000 miles, personal use equals 3000, and commuting equals 2000 miles, your total miles for the year equal 10,000. Business miles as a percentage of total miles equal 50% because 5,000 divided by 10,000 equals .5 or 50%.

In this example, you could therefore deduct 50% of your fuel, 50% of your insurance, 50% of your maintenance and repairs, 50% of the car loan interest, 50% of the depreciation, and so on, as a business deduction. This means you can t ever deduct all the costs of owning and running vehicle only the business use of a vehicle.

If you don t have exact records about your business use, you can sometimes use good sampling. For example, if you keep a good appointment calendar of your business activities, one popular tax reference suggests that you can look at the total business, personal and commuting miles driven during one week each month. Then, you can average this data to get good weekly estimates of your business, personal, and commuting miles. Finally, you can multiple these weekly estimates by 52 (the number of weeks in a year) to get reasonable estimates of your business, personal and commuting miles.

But before you go out and buy a new luxury auto, you need to know there s another complication. Congress limits in most cases the amount of depreciation or lease rental that you can include in your vehicle expense calculations. The rules are a bit tricky, but essentially, for purposes of vehicle depreciation and lease payments, you only get to look at the first $17,000 (roughly) of vehicle cost. In other words, if you buy a $60,000 vehicle and your friend buys a $15,000 vehicle, you may both have the same business depreciation expense even though your vehicle costs four times what your friend s does.

One other related point: You may have heard about the sport utility vehicle loophole. This SUV loophole really does exist. Specifically, the luxury auto limits mentioned above don t apply to sport utility vehicles that weigh more than 6,000 lbs. Note that Congress partially closed that loophole in 2004, however, by saying that a special, super-accelerated form of depreciation called Sec. 179 depreciation can t be used to write off all of the cost of an expensive SUV in the year the vehicle is purchased.

About The Author

Stephen L. Nelson, CPA

Redmond WA tax accountant Stephen L. Nelson is the author of both Quicken for Dummies and QuickBooks for Dummies and an adjunct tax professor for Golden Gate University s graduate tax school.

steve@stephenlnelson.com

Technorati Tags: automotive, autocare, auto care, car care, auto repair

You have bought a new trailer and have your first trip all planned out. Are you ready to start out on your trip? Assuming you have done all inspections for your trailer and cargo, then here are a few tips for being on the road and towing your trailer safely. Remember, there is a big difference between just driving your vehicle and hauling a load behind it. Handling characteristics will be startlingly different. Practicing on roads with little traffic or even in empty parking lots will help to give you a feel for how your vehicle will handle in different situations. And while in a deserted parking lot, it is a good time to practice backing and parking.

To back a trailer, turn your wheel right to back right and turn your wheel left to back left. Oversteering can cause the trailer to turn sharply, so do gradual movements. If you get in a bind, just pull forward and straighten everything out and try again.

Don’t forget to consult your vehicles’s owners manual for information on the correct driving gear when towing. If your manual is unavailable, call the dealer for your make of vehicle. Usually the service department has all the information you need and may have a few tips on the do’s and don’ts that may be useful to you.

Always drive at moderate speeds when towing. Some states even have laws and regulations for driving a certain speed below the posted limit when towing a trailer. Just be sure to leave plenty of time for your trip and don’t get in a hurry. This will also put less strain on your towing vehicle and may help in avoiding breakdowns. Also, driving at moderate speeds can avoid trailer sway .

While driving, it is essential you stay alert for potential problems ahead. Lane changes and braking are best when planned. Heavy braking can cause great problems such as sliding or even jack knifing, not to mention the extreme strain on your trailer, cargo or animals. A good rule of thumb on following distance of the vehicle in front of you is one and a half to two car lengths for every ten miles an hour of speed when towing. If people pull in front of you, drop back. Better safe than sorry. Try to anticipate having to stop for lights or traffic and begin slowing ahead of time. Remember, your braking time and distance are going to increase with a heavy load behind you. Try to avoid sudden steering maneuvers that could put you out of control when towing a load.

If the road you are traveling is bumpy or even gravel, you will need to travel at much slower speeds to maintain control. Gravel or “rutty” roads can even cause your vehicle and/or trailer to “float” and cause you to face disaster. Road and weather conditions will have an even greater effect on how you drive when towing.

When you make your first turn towing a trailer, you must remember to compensate for a much wider turn. The trailer’s wheels will be much further to the inside of a turn than the towing vehicle’s. The trailer will ride up on the curb, or into a ditch or, on left turns, even sideswipe vehicles.

There are other problems on the highway in dealing with other traffic and wind conditions. Large vehicles can cause wind shifts as they pass you. Just keep your hands on the wheel firmly and avoid over compensating. If the winds start your trailer swaying, do not hit the brakes. Instead, use the trailer brake activator to lightly apply the brakes on your trailer. Try shifting into a lower gear and decreasing the speed of your vehicle. Just hitting the brakes on the tow vehicle can make the sway worse as centrifugal force pushes the trailer forward.

If you have to pass another vehicle by changing lanes, please anticipate the much longer time needed for most vehicles when towing. Signal well in advance. Avoid passing on steep grades.You will need to start acceleration earlier and realize your tow vehicle will need much more time to pass when carrying a load. Make sure there is plenty of time to avoid oncoming traffic and leave plenty of clearance before moving back into your lane. You don’t want to hit the vehicle your passing with your trailer.

When traveling on roads with soft shoulders, avoid getting the trailer wheels off the pavement. Contacting the soft shoulder can cause the trailer to start to sway. If it happens, don’t panic. Do not try to steer right back onto the pavement or hard surface. Take your foot off the gas pedal but don’t hit the tow vehicles brakes. Activate the trailer brakes by hand and easily tap your vehicle brakes. Downshift if possible. When you have reached a much slower speed and your trailer is under control, gradually ease the wheels back onto the road.

When encountering steep grades you will notice different handling characteristics when towing. On a steep downhill grade the trailer can actually push your vehicle. Anticipate this and downshift and let off the gas a little. You may have to use your trailer brakes hand control to slow you but don’t ride them. Only tap them intermittently to avoid overheating of the brakes and ultimately, brake failure.. When facing a steep upgrade you should start accelerating early if possible. Again, you may have to downshift and keep increasing your gas pedal to compensate for the drag on you going uphill. As you reach the crest of the grade start backing off the pedal. A steep grade will test your tow vehicles limits.

Once you have reached your destination you have to find a place to park your “rig”. It’s best to avoid parking on a grade. The more level the parking area the better. If you have to park on a grade, it is best to chock the wheels. Hopefully, you have some with you. If you have someone to help, have them guide you into the spot. You can’t always rely on the mirrors as the trailer may block your view. Once stopped, keep your foot on the brake, turn your wheels toward the curb (pointed in on a down hill, out on an uphill), apply the parking brake and then shift into park, or with a manual, your lowest gear. This method helps avoid locking your transmission due to the extra load.

If you are on even a small grade and you plan to unhitch your trailer, you must apply chocks to the trailers wheels to avoid the trailer from rolling away when uncoupled. Just having the lift down will not make it stable. Jack stands also come in handy to level your load.I hope this article has provided you with useful information but it is not intended to be the ” be all and end all” of trailering safety. Read everything you can and talk to other more experienced trailer owners for tips on do’s and don’ts. Contact your state governments transportation department and familiarize yourself with laws, regulations and even local ordinances regarding trailers and towing.

About the Author

W. H. Ingle is the webmaster for http://www.longhornsales.com and a published author specializing in articles on the subject of trailering and transporting cargo and livestock.

Technorati Tags: automotive, autocare, auto care, car care, auto repair