Friday, March 27, 2009

Is the Apple tax worth paying?

I know you like your TV. Maybe it’s plasma, or has surround-sound; maybe it makes the helm of the Starship Enterprise look like a cereal box with lights painted on. If you had to buy it again, you would. No question.

What if, though, I took your TV, painted it white, stuck a picture of an apple on the back, and then upped the price by 500 bucks. Would you buy it now?

Steve Ballmer (right), Microsoft CEO, took a lot of flak last week for suggesting Apple practice just this kind of fleecing of its customers. Ballmer, from an unbiased perspective of course, claims Mac users are mugs.

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Thursday, March 26, 2009

Charities Skeptical About Obama's Proposed Tax Change

Charitable groups continue to warn that reducing the charitable tax deduction, as President Obama proposes, would hurt organizations already struggling to drum up funding in a recession.

Charity groups are still jittery over a proposed tax change they say could cause wealthy donors to give less, despite assurances from President Obama this week that donations are unlikely to go down because of a reduction in the tax deduction for charitable contributions.

While Obama argues that his administration is trying to make sure low-income donors enjoy the same tax benefits for their giving as high-income donors, charities and the organizations that represent them say they are concerned they could end up paying the price for a more equitable tax code.

"To put any block between the donor and the charity at this time, I think, is not helpful," said Lisa Hillman, board chairwoman for the Association for Healthcare Philanthropy.

Obama told reporters during his prime-time press conference Tuesday that charities are wrong to assume the change will discourage donations.

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Friday, March 20, 2009

Tax tips for the self employed

Small businesses are being hit hard by the recession, with 85 now closing every day. Simple tax measures could make all the difference in 2009 – and all businesses should ensure they take advantage of the Government’s new schemes to help the self-employed through these tough times.

Here are five top tax tips to help you ride out the recession. You can also read our small business survival guide here.
  1. Don't wait for help

    Don’t wait for HM Revenue & Customs (HMRC) to come after you if you owe money. If you have trouble paying, talk to the Business Payment Support Service to arrange additional time to pay.

    The service was set-up on November 24,2008 to allow businesses to delay payments of tax, National Insurance, VAT or other payments owed to HMRC. Call 0845 302 1435.

  2. Reduce your income tax
    If you are self-employed and your profits are falling, you may be able to reduce your income tax payments, which are due on January 31 and July 31. You will need to call HMRC and request a SA303 form or download one here.

  3. De-register for VAT
    Do you really need to be registered for VAT? You must register only if the value of your taxable supplies in the past 12 months or less has exceeded £67,000. De-registration may enable you to reduce your prices or to keep more of your sales.

  4. Use the VAT cash accounting scheme
    If you sell more on credit than you buy on credit, look at the VAT Cash Accounting Scheme. Normally you pay VAT on your sales whether or not your customer has paid you – but using this scheme means you do not need to pay VAT until the customer has paid. If the customer never pays, you never have to pay the VAT.

    You can use cash accounting if your estimated turnover during the next tax year is not more than £1.35 million. If VAT cash accounting is not for you, VAT bad debt relief can be claimed if your customer has not paid you after six months.

  5. Claim your small business rate relief.

    Businesses have to pay their rates – like council tax – to their local authority, but if your premises have a rateable value of £15,000 (£21,500 in London) or less then you can claim a discount. Contact your local council for more information.

Source :

Thursday, March 19, 2009

Tips for outsourcing bookkeeping resources

As an accountant, responding to a request from your clients to find a competent bookkeeper can present significant challenge because:
  • They will most likely only need someone part time.
  • Nine times out of ten they will insist the person works at their premises.
  • They will expect you to provide someone excellent for free.
Of course, if you have your own team of internal bookkeepers you will attempt to persuade them that this is the best solution, but what if they don’t budge?

Most of the major recruitment players are less than ideal as they don’t specialise in part time bookkeepers. You also know that their approach is simply to aggregate the CVs of those candidates who happen to have walked into their offices that week. They forward them and let the client make the choice, without any sort of technical vetting. This won’t do, so you would probably look at the following options:

  1. Use one of the tried and trusted bookkeepers you have been using for ages.
  2. If they can’t do it you ask around your partners or local practitioners to see if they know anyone who is available and trustworthy.
  3. Put up an advert online on sites such as Gumtree, Monster etc.
  4. Tell the client to find one themselves.
At a time when ‘added value’ is a key differentiator and clients are struggling with dwindling revenues and slow cashflow, the last thing they need is inaccurate management information and/or big bill at the year end from you. Both of these consequences will arise if they use an incompetent bookkeeper.

So, how can you keep crucial goodwill with your client and satisfy their request without wasting hours and hours of your valuable time for free? From your client’s perspective, surely you must know a bookkeeper for goodness sake? You are an accountant after all!

You get the call (again), and go through the options.
If you do have a trusted bookkeeper and they are free, you can recommend them and then go back to the large pile of work on your desk, delighted that there is one less thing to do - until the next request comes in, that is.

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Friday, March 13, 2009

IRS tax tip: free tax assistance

If you or your spouse are a member of the military, you may be eligible to receive free tax return preparation assistance, IRS officials said. The U.S. Armed Forces participates in the Volunteer Income Tax Assistance program and provides free tax advice, tax preparation, return filing and other tax assistance to military members and their families.

The Armed Forces Tax Council oversees the operation of the military tax programs worldwide, conducting outreach with the IRS to military personnel and their families. The AFTC consists of tax program coordinators for the Marine Corps, Air Force, Army, Navy and Coast Guard.

Volunteer assistors at Military-based VITA sites are trained to address military-specific tax issues, such as combat zone tax benefits and the new Earned Income Tax Credit guidelines.

To receive this free assistance, you should bring the following records to your military VITA site:
  • Valid photo identification
  • Social Security cards for you, your spouse and dependents or a social security number verification letter issued by the Social Security Administration
  • Birth dates for you, your spouse and dependents
  • Current year’s tax package, if you received one
  • Wage and earning statement(s) — Form W-2, W-2G, 1099-R
  • Interest and dividend statements (Forms 1099)
  • A copy of last year’s federal and state tax returns, if available
  • Checkbook (to get routing number and account number for direct deposit)
  • Total amount paid for day care and day care provider’s identifying number
  • Other relevant information about income and expenses

If your filing status is Married Filing Jointly and you wish to file your tax return electronically, both you and your spouse should be present to sign the required forms. If it isn’t possible for both to be present, a valid power of attorney that allows tax preparation can be used to sign and file the return.

There is a special exception to using a power of attorney for spouses in combat zones that permits the filing spouse to e-file a joint return with only a written statement setting forth that the other spouse is in a combat zone and is unable to sign.

For more information, review IRS Publication 3, Armed Forces’ Tax Guide, available on the IRS Web site at or order a free copy by calling 800-TAX-FORM (800-829-3676).

On the net: (like government)


Thursday, March 12, 2009

What Should You Expect From Your Accounting Services?

It can be difficult for a business to give up control of important functions such as accounting services to an outside agency. Although the argument in favor of outsourcing may look good on paper, there is always the worry that some inept or even dishonest bookkeeper could damage the business.

Once a company has made the decision to contract outsourced bookkeeping services, the decision of which company to work with is more than a matter of throwing a dart at Yellow Pages listings. Finding the right accounting services organization will make all the difference.

What Service Does the Company Offer?

Avoid companies that are just starting out. Although as a business owner you might be sympathetic to the struggling startup, do you really want to deal with getting your books back if their business should fail? Stick with businesses that already have a proven track record of success.

Today's accounting services are all computerized. Even if keep all your financial records written on cocktail napkins and the backs of envelopes, your bookkeeper should be using an accounting software package. They should offer online account services including 24/7 access to your books through a secure internet connection.

Ensure that your books will be handled by the same person all the time and not just whoever is available at the moment. You will build a relationship with this bookkeeper over time and want to have someone who can focus on your business.

Interview Your Future Bookkeeper:

Don't be afraid to quiz your bookkeeper on experience and education. There are a few people out there who offer bookkeeping services and yet don't know an asset account from a cash flow statement.

Continuing education is as important as past experience. It may seem as though fundamental accounting skills haven't changed much, but new skills and technology are surfacing all the time. You want your bookkeeper to maintain skills and knowledge, perhaps even finding new ways to help maintain your company's financial records.

Will the bookkeeper be available during normal business hours? The surge in telecommuting has given rise to bookkeepers who are trying to do their jobs in between personal commitments. While that may work in some fields, accounting services personnel need to be available to their clients during standard hours.

Ask how you will be communicating with each other. Telephone, email, instant messaging, and online project management tools are all common methods. You should also find out what kind of reports you can receive and when to expect them.

If possible, find someone who has specific experience with your industry. Although each industry uses the same financial basics, details such as industry jargon or best industry practices may confuse someone who has experience with other industries. If you can't find someone with specific industry experience, find someone who is willing to learn.

Author is a freelance copywriter. For more additional information on Controller Services, visit

Source :

Friday, March 6, 2009

Tax Tips For The Individual Investor

As the old saying goes, there are only two certainties in life: death and taxes. While we have yet to find a way to successfully avoid either, there are a few tricks of the trade that can minimize the impact the tax man has on your pocketbook.

After all, nobody likes taxes, but we all have to deal with them, so we might as well handle them in the best way possible. When the end of the year approaches, many investors' thoughts turn to how they can avoid paying tax. (Notice we said avoid, not evade.) Although a lot depends on your personal situation, there are a few simple tax principles that apply to most investors and can help you save money (We also recommend talking to a tax planner.) In this article, we'll look at the tax benefits of making smart investment decisions, writing off expenses, effectively managing your capital gains and more.

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Thursday, March 5, 2009

PersonalFinance: A survival guide for tax season

With all of the budgets, bailouts and stimulus bills flying around, one thing remains certain and, as always, it's taxes.

Confusion about all of these new provisions is not an excuse for missing the deadline that comes every year. You have to file your forms (or an extension), and pay your 2008 bill by April 15. If you're not sure what you can and cannot deduct, or where the newest tax breaks are hidden, it's time to get help.

Try not to feel bad -- after all, even Treasury Secretary Tim Geithner has gotten himself confused over his income taxes, and he's an economist and in charge of the Internal Revenue Service.

This tax season is extra complicated, but there's a silver lining to that, too: There are more ways for you to bulk up your refund if you know where to look.

Here's a guide that will save you money and anxiety at tax time.
  • Don't pay more than you have to to do your taxes. If you expect your 2008 adjusted gross income to be less than $56,000 and have a relatively straightforward return, you can prepare and file your return for free via the IRS's own file program. Start at and click on the "freefile" logo. If you're hooked on TurboTax, you can still save money by buying a lower-level of the program than publisher Intuit may try to sell you. All forms are in all versions, so even folks with self-employment income and stock losses can get by with the Deluxe edition (which includes one state's tax forms) and sells for $60 or less.
    You may get a second chance at last year's rebate. Remember those checks most taxpayers received last year? They were a $600 rebate for individuals, $1,200 for couples and $300 for each dependent child. Folks who didn't qualify earned more than $75,000 ($150,000 for couples) in 2007. But if their 2008 income fell under those limits, they may qualify now. If you didn't get the rebate last year, or if you added a child to your family last year, you may qualify for more of the rebate this year. There's a new line item on your 1040 that will let you file for this.

  • You can time-travel with your home purchase, too. If you're a first-time homebuyer who bought a house in 2009, you can get a tax credit on your 2008 taxes for 10 percent of the purchase price up to $8,000.
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