Changes to 1040 for this year...2010 - 2009 form 1040

Tax preparers will find the following section-by-section, line-by-line look at key tax law changes on the 2009 Form 1040 a great start to understanding how the rules have changed. (For a rundown of new rules and regulations that may impact your client's 2009 returns, see the accompanying story, New Rulings Impact 2009 Form 1040.)

Filing Status and Exemptions

The changes on Form 1040 start at the top, with a revised definition of a qualifying child dependent [Code Sec. 152(c)]. The revised rules apply both for dependency exemption purposes as well as for purposes of qualifying for head of household filing status.

In addition, a noncustodial parent claiming an exemption for a child can no longer attach pages from a divorce decree or separation agreement executed after 2008 to back up the claim. The noncustodial parent must attach Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent, or a similar statement signed by the custodial parent releasing the claim to the exemption.

Income

Line 7, Wages, salaries, tips, etc. Military differential payments made after 2008 to former employees while they are on active duty for more than 30 days in the Armed Forces or other uniformed are now treated as wages [Code Sec. 3401(h)]. These payments should be included in box 1 of Form W-2.

Line 19, Unemployment compensation. As a general rule, gross income includes any unemployment compensation benefits received under the laws of the United States or any state. However, for 2009 only, the first $2,400 of unemployment compensation benefits received are excluded from gross income by the recipient [Code Sec. 85(c)].

Line 20, Social Security benefits. During 2009, Social Security recipients received a bonus in the form of a $250 economic recovery payment [2009 ARRA §2201]. The economic recovery payment is tax free and should not be included in income. Moreover, although the payment was made by the Social Security Administration, it should not be included in the amount of Social Security benefits on Line 20a. However, in the case of a working senior, the economic recovery payment will reduce the amount of the Making Work Pay credit otherwise allowable (see below).

Tax and Credits

Line 40, Itemized deductions or standard deduction.

Standard Deductions. As was the case in 2008, taxpayers claiming the standard deduction are entitled to additional standard deduction amounts for real estate tax payments or disaster losses. The additional real property tax deduction can be claimed for up to $500 ($1,000 for married couples filing jointly) of real estate taxes of the type that would be allowable as itemized deduction [Code Sec. 63(c)(7)] . The disaster loss deduction is equal to the difference between personal casualty losses and personal casualty gains attributable to a federally declared disaster [Code Sec. 63(c)(8)].

Also, for 2009, eligible taxpayers can claim an additional standard deduction amount for new motor vehicle taxes [Code Sec. 63(c)(9)] The deduction is limited to the tax on up to $49,500 of the purchase price of a qualified motor vehicle, subject to a phase-out for higher-income taxpayers.

Taxpayers claiming an additional standard deduction amount must check the box on Line 40b and complete the following:

NEW SCHEDULE L. Ironically, with the growing number of "add-ons," the standard deduction, which was intended to provide simplicity, has become nearly as complex as itemizing deductions. Taxpayers claiming any of the additional standard deduction amounts must complete new Schedule L, Standard Deduction for Certain Filers. At 21 lines, the new schedule is only slightly shorter than 30-line Schedule A for itemizers. In addition, taxpayers claiming any additional standard deduction amounts cannot use simplified Form 1040-EZ.
Itemized Deductions. The new motor vehicle sales tax deduction also shows up as a new entry (Line 7) on Schedule A, Itemized Deductions, along with an accompanying worksheet. The itemized deduction for motor vehicle sales taxes is subject to the same rules and limitations as the standard deduction add-on.

Taxpayers claiming personal casualty or theft losses on Line 20 of Schedule A face some new rules. For 2009, the per-casualty deduction floor is increased from $100 to $500 [Code Sec. 165(h)(1)]. In addition, net disaster losses are deductible without regard to whether aggregate net casualty losses exceed 10% of adjusted gross income (AGI) [Code Sec. 165(h)(3)]. For purposes of applying the 10% limitation to other personal casualty or theft losses, losses deductible as a disaster loss are ignored. This has the effect of treating net disaster losses as a deduction separate from all other non-disaster casualty and theft losses. These deductions are computed on a revised version of Form 4684, Casualties and Thefts.

Line 45, Alternative minimum tax. ARRA increased the individual AMT exemption amounts for tax years beginning in 2009 to (1) $70,950, in the case of married individuals filing a joint return and surviving spouses; (2) $46,700 in the case of other unmarried individuals; and, (3) $35,475 in the case of married individuals filing separate returns [Code Sec. 55]. Also for tax years beginning in 2009, ARRA allows an individual to offset the entire regular tax liability and alternative minimum tax liability by nonrefundable personal credits.

Line 49, Education credits. For 2009, a modified version of the Hope Scholarship credit (aka the American Opportunity credit) may be claimed for expenses paid for any of the first four years of a student's post-secondary education [Code Sec. 25A]. The maximum credit is $2,500 per eligible student (100% of the first $2,000 of qualified expenses and 25% of the next $2,000 of qualified expenses, subject to a phase-out for higher income taxpayers. For 2009, the definition of qualified expenses is expanded to include course materials in addition to tuition and fees. Up to 40% of the otherwise allowable credit is refundable (unless the taxpayer claiming the credit is subject to the "kiddie tax"). The modified credit is calculated on a revised version of Form 8863, Education Credits (American Opportunity, Hope, and Lifetime Learning Credits).

Lines 52 and 53, Other credits. A number of new or improved energy-related tax credits can be claimed for 2009. These include

The nonbusiness energy property credit (Form 5695) [Code Sec. 25C].
The residential energy efficient property credit (Form 5695)[Code Sec. 25D].
The credit for qualified plug-in electric vehicles (Form 8834) [Code Sec. 30].
The alternative motor vehicle credit (Form 8910) [Code Sec. 30B].
The alternative fuel vehicle refueling property credit (Form 8911) [Code Sec. 30C].
The credit for new qualified plug-in electric drive motor vehicles (Form 8936) [Code Sec. 30D].
The plug-in conversion credit (Form 8910) [Code Sec. 30B].
These credits are computed on the appropriate forms and entered on Lines 52 and 53 of Form 1040.

Other Taxes

Line 60, Total tax. Taxpayers frequently must add additional taxes to the income tax computed in the Tax and Credit section of the forms. Some of these taxes, like self-employment tax, have separate lines on Form 1040, but others must be computed off the form and included in the total tax on Line 60.

For 2009, some higher-income taxpayers who received the new COBRA premium subsidy must recapture all or part of the subsidy as an additional tax. Eligible individuals who became entitled to COBRA coverage during 2009 because of an involuntary termination of employment received the subsidy in the form of a 65% reduction in the otherwise required premium for health care continuation coverage. However, a recapture rule applies for taxpayer's with modified AGI above $125,000 ($250,000 for joint return filers). The full amount of the subsidy is recaptured for taxpayers with modified AGI of more than $145,000 ($290,000 for joint filers). The recapture amount should be entered on the dotted line next to Line 60 and identified as COBRA. The amount should be included in the total tax entered on Line 60.

Any recapture of the new first-time homebuyer credit is also included in the total tax on Line 60 (see also Line 67 below).

Payments

Line 63, Making work pay and government retiree credits. While most wage earners received the benefit of the Making Work Pay credit through reduced withholding during the year, all eligible taxpayers will still have to compute the credit on their 2009 returns. The credit is the lesser of (1) 6.2% of an individual's earned income or (2) $400 ($800 in the case of a joint return). The credit is phased out when AGI is more than $75,000 ($150,000 for joint filers). Here again, the 2009 Form 1040 contains something new.

NEW SCHEDULE M. This new page-long form is used to calculate the Making Work Pay credit, which is then entered as a payment on Line 63 of Form 1040.
Certain payments and credits for government retirees reduce the Making Work Pay credit. These reductions are calculated on Schedule M.

Line 64, Earned income credit. ARRA increased the EITC credit percentage for families with three or more qualifying children to 45% for 2009 and 2010 [Code Sec. 32]. Thus, for 2009 taxpayers with three or more qualifying children may claim a credit of 45% percent of earnings up to $12,570, resulting in a maximum credit of $5,656.50. The Act also increased the threshold phase-out amounts for married couples filing joint returns to $5,000 above the threshold phase-out amounts for other filers for 2009 and 2010. For 2009, the maximum credit of $3,043 for one qualifying child is available to joint filers with earnings between $8,950 and $21,420. The credit begins to phase down for joint filers at a rate of 15.98% earnings above $21,420. The credit is phased down to $0 at earnings of $40,463.

Line 65, Additional child tax credit. To the extent the child credit (Line 51) exceeds a taxpayer's tax liability, the taxpayer is eligible for a refundable credit (the additional child tax credit). As a general rule, the refundable credit is calculated using the earned income formula, under which the refundable credit is equal to 15% of earned income in excess of a threshold dollar amount. The threshold dollar amount is indexed for inflation. The threshold dollar amount for 2009 was originally set at $12,550 for 2009, but was reduced to $3,000 by the American Recovery and Reinvestment Act [Code Sec. 24]. The additional child credit is treated as a payment of tax on Line 65 of Form 1040.

Line 66, Refundable education credit. This line is used to claim the refundable portion of the American Opportunity credit (see Line 49 above). The refundable portion of the credit is calculated on revised Form 8863.

Line 67, First-time homebuyer credit. Last, but far from least, taxpayers who purchased a new home during 2009 may be eligible for a first-time homebuyer credit [Code Sec. 36]. The maximum credit amount is $8,000 ($4,000 for a married individual filing separately) for homes purchased after December 31, 2008, and before December 1, 2009. The credit phases out for individual taxpayers with modified adjusted gross income between $75,000 and $95,000 ($150,000 and $170,000 for joint filers) for the year of purchase. The credit is refundable and is treated as a payment of tax on Line 67 of the 2009 Form 1040. Note, however, that a taxpayer may elect to treat a home purchased in the eligible period in 2009 as if purchased on December 31, 2008, for purposes of claiming the credit on the 2008 tax return. The first time homebuyer credit is calculated on a revised version of Form 5405, First-Time Homebuyer Credit and Repayment of the Credit.

As its name implies, Form 5405 is also used to calculate recapture of a first-time homebuyer credit claimed for 2008. For homes purchased in 2008, recapture is required ratably over 15 years beginning with the second year taxable year after the year the home was purchased. Consequently, ratable recapture won't kick in until 2010. However, recapture is also required if the home is sold or otherwise ceases to be the principal residence of the taxpayer within 36 months from the date of purchase. Any repayment amount is entered as an additional tax on Line 60 of Form 1040 with the caption "FTHCR" entered on the dotted line.

Note: Ratable recapture does not apply to homes purchased in 2009; however, recapture is required if the home is sold or ceases to be a principal residence within 36 months of purchase.

Refund

As in prior years, taxpayers can direct that all or part of a tax refund be directly deposited to a checking or savings account or to a TreasuryDirect® online account to buy U.S. Treasury marketable securities and savings bonds. Starting with the 2009 return, taxpayers can use a refund to buy up to $5,000 of U.S. Series I Savings Bonds without setting up a TreasuryDirect® account. Amounts requested must be in multiples of $50.

IRS to regulate paid tax preparation

The Internal Revenue Service plans to test, register and screen people who get paid to prepare tax returns, stepping into a virtually unregulated business on which millions of Americans depend for crucial financial services.

The agency wants to crack down on preparers who do shoddy or fraudulent work and create a way for consumers to make more informed choices -- though the moves could increase the cost of having tax returns prepared.

"In most states you need a license to cut someone's hair," but today "most tax-return preparers don't have to meet any standards when they sit down and prepare a federal tax return for an American taxpayer," IRS Commissioner Douglas Shulman said in an interview Monday.

The agency said it will phase in the changes with the 2011 tax season.

The announcement underscores the fact that helping Americans comply with the federal tax code has become a big business. The industry is a sprawling one, taking in brand-name national players such as H&R Block and Jackson Hewitt, mom-and-pop practitioners who hang out their shingles each tax season, and fly-by-night operators who can leave taxpayers on their own when the IRS finds fault with their returns.


The IRS estimates that 900,000 to 1.2 million people prepare tax returns for a fee, and many do so without ever being officially tested.

"Right now, the IRS doesn't know who unregulated preparers are and can't track them when there's a problem. This ultimately hurts the taxpayers who end up having to pay more taxes, fines and penalties," Sen. Charles E. Grassley (R-Iowa), who presided over a hearing on the issue years ago, said in a statement.

Starting with the 2011 tax season, the IRS plans to require paid preparers to register with the agency. Subsequently -- the timeline is not yet firm -- they will be required to pass competency tests and receive continuing professional education.

The IRS said it will screen preparers to make sure they have paid their own taxes.

In a report issued Monday, the agency also raised concerns about the quality of tax-preparation software and about the marketing of loans backed by expected returns.

Last year, almost 94 million returns were completed using tax software. Both taxpayers and professional preparers relied on the programs, though "quality control over these products rests exclusively with the software publishers," the IRS said.

Meanwhile, some preparers encourage consumers to take out loans against anticipated refunds, without fully explaining the costs, the agency said.

Source:

Dubai crisis impact on Indian economy

Economic growth in the United Arab Emirates is set to disappoint next year, with Dubai debt woes expected to boost credit costs as investors can no longer count on implicit government support for indebted state companies.

The global credit crunch sent the top Gulf Arab economies -- Saudi Arabia and the UAE -- into downturn this year, but high state spending and a turnaround in oil prices were seen helping the world's top-oil producing region to get back on its feet.

The UAE's prospects have dimmed, however, now that Dubai, which had once enjoyed stellar property-fuelled growth, has asked for a repayment freeze on billions of dollars worth of debt issued by its key state-owned construction firms.

Exports are going to be the most affected by Dubai woes, as the UAE region is now India's largest export destination toppling the United States.

Besides, bullion trading in Dubai is likely to be impacted, which may have ripple effect for India as around USD 29 billion of gold from the country is being traded in Dubai.

However, the silverline to this whole scenario is that the ongoing crisis would only impact the Dubai's economy, and countries such as Abu Dhabi is likely to remain on a firm keel in comparison and this should help mitigate the damage to India's exports to the UAE, the report added.
On November 25, the Dubai government had announced the restructuring of Dubai World, and asked all providers of financing for the company and Nakheel to "stand still" and extend maturities until at least May 30, 2010.

Trip cost to Dubai has fallen by 40% due to economic downturn.

Reason for dubai crisis:

The company ia a classic example of huge borrowing beyond its means. In short, the company borrowed a huge amount from banks to finance its various projects during the 2005-08 boom period but failed to come up with a repayment plan. The global crisis of 2008 triggered the crisis and it never recovered from the blow. Dubai accumulated $80 billion of debt by expanding in banking, real estate and transportation before the financial markets were hit by the global crisis. Dubai World accounts for $59 billion of these liabilities and it doesn’t have money to repay this debt. Dubai suffered the world’s steepest property slump in the global credit crisis as home prices fell 50 per cent from their 2008 peak.

Indian banks have informed the Reserve Bank of India that their loan books in Dubai are insignificant compared to their total turnover. The reports are part of the information that RBI has called for from the banks to evaluate their exposure to Dubai World, the city state’s investment company which has asked for a “standstill” on debt repayment till May 2010.
The combined exposure of SBI, BOB, and ICICI Bank as per their estimates on Friday stood at less than Rs 7,000 crore. “Our exposure to the UAE is less than Rs 1,500-crore, which is below 0.3 per cent of the total loan-book of the bank”, said an official of State Bank of India. The loans to Dubai-based clients is largely in the form of short-term loans, which will be repaid in 3-6 months time, he said.

ICICI Bank, also said the bank did not have any significant exposure to Dubai corporates. “ICICI has no material, non-India linked exposure to Dubai corporates,” its spokesperson said.
Out of the Bank of Baroda’s global loan-book of Rs 1,50,000 crore, that for the UAE region is Rs 10,000 crore. Dubai accounted for half of that at Rs 4,000 crore, said CMD MD Mallya. “The bank has only a 7-8 per cent of the total loan-book exposure to the Gulf region. These accounts are well maintained and are unlikely to cause any kind of impact on the balance-sheet,” he said. Bank of Baroda’s total exposure to real estate projects in UAE is even less at Rs 600 crore. Mallya said all the projects are well diversified ones and are performing well.

Standard salary range in USA and India comparision as per survey

Here is a list of standard wage earned by different professional in USA working in USA.

1. Office clerk, $32,457
2. Registered nurse, $61,345
3. Information technology specialist $67,082
4. Human resources specialist, $50,459
5. Civil engineer $73,151
6. Accountant $49,982
7. Social worker $53,550

Here is a list of standard wage earned by different professional in India .

1. Office clerk, $2700 (INR 124200.00)
2. Registered nurse, $2500 (INR.115000)
3. Information technology specialist $20,000 ( INR.9,20,000.00)
4. Human resources specialist, $13,043 (INR.6,00,000)
5. Civil engineer $5217 (INR.240000)
6. Accountant $5217 (INR.240000)
7. Social worker $2000 (INR.92000.00)

Recession over????

New Delhi: In another sign of recovery in Indian industry, the sales of personal computers in the country were up 24 percent in the quarter ended September 30 and touched 2.19 million units, according to leading market research firm IDC.

"The July-September quarter experienced strong boost from new found consumer confidence that reflected in increased demand during the festive season," said Kapil Dev Singh, country manager of IDC India.

I can see jump in recruitment in IT/ITES segment which is giving a sign of relief to many of the unemployed youths who are desperately waiting for some job. But this is a very good lesson for every one who were in job or studying to get job. Don't concentrate on one single sector be multi-talented and save money for future unknown,uncertain events. Don't borrow exceeding your rep able limit.

I have read many storied during recession as to techies leading their life by taking private tuition's, taking up some part time non-IT jobs.

It is also a good lesson for real estate industry which was worst hit and sold flats at cost or below the cost price.Some densely crowded areas got some relief from traffic jam.

Even in US there was some recovery in terms of home sale data and price increase in home prices.

Indian IT cos EU billing rates may come under tax strain

ANEW tax rule in the European Union (EU) is making the light at the end of the tunnel for Indian IT service companies look a little dimmer.

Starting January 1, the 27-nation bloc plans to impose value-added tax (VAT) on services delivered from non-EU nations, including India, a move which will put a renewed squeeze on profit margins of companies such as Tata Consultancy Services, Infosys and Wipro, offshore outsourcing experts and tech firms said.

European companies that outsource IT and backoffice work will be looking to extract better value out of their service providers to offset the financial implications of the tax, which could increase the cost of such projects by up to 25%, said Nick Beecham, partner at the UK-based law firm Field Fisher Waterhouse.

Europe accounts for over a quarter of the $60-billion revenues of the Indian outsourcing industry. Many businesses will already be doing this in the current economic climate. We particularly expect to see this happening with those outsourcing contracts that were signed two or more years ago at the height of the economic boom, Mr Beecham said, expecting outsourcers to renegotiate billing rates at least 10-15 % lower.
Most contracts have terms included for addressing potential tax implications, but rates have been shrinking in any case for most outsourcing companies, a senior official at an IT company said on condition of anonymity.

Customers want to do more with less, and this tax issue can be an effective excuse for driving rates further down, this person added.

The tax rule change was made in February 2008 to come into effect from January 1, 2010. Preoccupied with other more pressing challenges during the worst economic crisis since the Great Depression, companies are only now beginning to look at amending contracts to take into account the financial implications of the new levy.

Sridhar Vedala, managing director of outsourcing advisory firm Quantum Step, is of the view that projects will become more expensive depending upon VAT rates in different EU countries. This would mean an increase of up to 15% in the UK, and in continental Europe its higher, as much as 25%, he said.

America no longer the dream destination for Indian students

New Delhi: The U.S. is no longer the dream destination for Indian students. Data released by the U.S. embassy has shown a sharp decrease in the number of students opting to study in the U.S. according to analysts, Indian students are seeking other destinations because of the global slowdown and tight visa procedures, reports IBN Live

The U.S. embassy data reveals there is a 25 percent decrease in F1 student visas over the past one year, which means only 25,680 U.S. visas were issued for Indian students between October 2008 and September 2009 as compared to 34,510 visas last year."A large number of students wanted to stay on and work after the studies so as to cover the cost of the education. This is not happening because of the recession and the lack of jobs available in the U.S.," said, Director of Career Smart, Usha Albuquerque.

When considering the cost of a U.S education, include the cost of tuition, living expenses, books and other items. Tuition varies widely from university to university, but it is usually the largest single cost an international student faces. A yearly tuition of $28,000. Sources of financial aid available to international students at the undergraduate level are limited and highly competitive.

Your financial plans should cover your entire program. An undergraduate degree in the United States takes an average of four to five years to complete. Master's programs may last one to three years. Doctoral programs may take anywhere from five to seven years, depending on your field of study and previous education. Non-degree or vocational programs last anywhere from several month to two years.

Plus one has to take care of their living in US which is also costly. The cost of health insurance varies but generally ranges from $3,500 to $4,000 per year for a family.

Source: Silicon valley of inda and other sources.

Second recession in USA

The US markets ended lower for the second session yesterday on the back of mixed global cues and disturbing job loss data. Does this mean we’re still not out of the woods? Marc Faber, Editor and Publisher of the Gloom, Boom & Doom Report feels nothing has been solved in the US in the last 6-9 months and that a big economic crisis was still to be seen ahead. “The policy makers in the US, are still in-charge and if you look at what has happened in the US over the last 6-9 months, nothing has been solved. It has been postponed through fiscal and monetary measures, precisely the measures that brought about the crisis in the first place. So enjoy your ride in asset classes as long as it lasts but I think we are seeding the next crisis and it may happen in the next three months, maybe tomorrow, maybe five years, maybe only in 10 years but I think the big crisis is still ahead of us.” He said that the markets were overbought and that the economic news was still not good.

Here is a verbatim transcript of the exclusive interview with Marc Faber on CNBC-TV18. Also watch the accompanying video.

Q: There have been stray concerns on where the market might be headed, and whether things are approaching a bubble like proportion, especially in the equity market. What do you feel?

A: Basically, we have had huge fiscal stimulus packages and we had quantitative easing in basically all countries around the world. So asset prices have recovered strongly after March 6 this year, with stocks rising, commodity prices rising and the dollar weakening again and each time the dollar weakens it is kind of a symptom of some inflation in the system and excess liquidity building up. What we have is large cash positions around the world and zero interest rates and also the policy by the Fed to keep the matter very low level for a very long time as was the case of 2001. With this in mind, money goes out of cash balances into something, either consumption or into some kind of assets like equities or commodities or bonds or art or real estate.

Q. While the rally has been intact, there seems to be one concern which is that interest rates will soon start moving higher and that in turn will start sucking the liquidity out or the easy liquidity out. Is that a real fear for the market?

A: I don’t think so. I think we have to distinguish between short-term interest rates and long-term interest rates. Long-term interest rates, the Federal Reserve does not really control them in the long run. Temporary they can somewhat control them through quantitative easing and through the purchases of 10 year bonds, 7 year bonds, 30 year bonds but what they control are the short-term interest rates in other words, the Fed fund rates. Reading through the literature and through the speeches that are being given by Mr Ben Bernanke, my impression is that the short-term interest rates will stay long for a very long time. In America the fiscal deficit this year will be around USD 2 trillion and I do not think they can cut the fiscal deficit next year because if they cut it, it will have a negative impact on the economy. So I rather think that the fiscal deficit will stay at this level or in my opinion actually even increase. That will lead the Fed to keep interest rates artificially low because should they increase short-term rates meaningfully then the cost of servicing the government debt in the US will escalate substantially. So I think as far as the eye can see, monetary policies in the US will stay expansionary.

Q. Will talk about sectors and markets in specific in a bit but what about the dollar? There has been almost a straight line correlation between the way emerging markets have moved and the way the dollar has been weakening. Do you sense that is going to snap back soon?

A: If I look around the world — and this is frequently missed in the inflation-deflation debate — the US current account deficit, growing from USD 150 billion to USD 800 billion between 1998 and 2007 flushed the world with liquidity and led to essential inflation in emerging economies, in particular asset inflation. We now have flats in Hong Kong, in other words condominiums selling for up to USD 9000 a square feet. In America, price levels compared to the price levels in some of the Asian cities is actually now quite low. So I think that the US dollar is no longer overvalued for the time being and the sentiment about the US dollar is so negative that we could have a rebound in the dollar for a couple of months and that would indicate some tightening of global liquidity and be bad for asset markets as was the case in 2008 when the US dollar rebounded, all asset market went down.

Q: If there were to be a snap back, how powerful do you think it might be, are we talking about a big pullback for the dollar considering how much it sold off these past few months?

A: That I doubt because the Federal Reserve and the US government pursue policies that are not conducive to a strong US dollar. But as I said we are very oversold and could see some rebound, at maybe around 10% or so. But I would not expect the US dollar to be structurally a strong currency in the next few years, quite on the contrary I think the US dollar will continue to lose its purchasing power.

Q: While the correction has been called for many months now, do you see a situation over the next few months where the liquidity can actually push markets to far higher levels and see almost a blow out like rally over the next couple of months?

A: That I doubt; we are very overbought and the economic news is not particularly good. So I think that before we would rise much more in equity markets, a correction should actually take place. But markets are unpredictable and it is conceivable that there is a kind of a blow-off phase before we go down substantially. But I would not bet on that. I think the big move to grave this out, we are up 100% in India, we are up 50% in the United States, may be we go up another 10%, but we are not going to go another 100% straight away.

Q: As you watched the markets right now, do you see any similarities with the situation that we had in 2007 and just by extension of that if there is indeed a correction who do you think will falter a blink first, the equity markets or the commodities or a completely other asset class?

A: I think equities after the peak in October 2007 collapsed around the world by plus or minus 50% and now they have rebounded but they are not at their previous highs. In the meantime, in some countries, companies have continued to increase their earnings and so the valuations are not as stretched as in 2007. But what disturbs me personally is that we had the financial crisis. The cause of the financial crisis was excessive debt growth that was essentially produced by notably the American Central Bank, the Federal Reserve. Now the same people who produced the crisis namely the policy makers in the US, are still in-charge and if you look at what has happened in the US over the last 6-9 months, nothing has been solved. It has been postponed through fiscal and monetary measures, precisely the measures that brought about the crisis in the first place. So I think enjoy your ride in asset classes as long as it lasts but I think we are seeding the next crisis and it may happen in the next three months, maybe tomorrow, maybe five years, maybe only in 10 years but I think the big crisis is still ahead of us.

Q: Where does India fit in your preferred or not preferred list right now of markets?

A: I think the Reserve Bank of India (RBI) has one of the best monetary policies in the world because they supervise the financial sector very closely. They have maintained relatively tight monetary policies and also they pay attention not only to core inflation which is not representative of the cost of living increase and is not representative of inflation in the system but the RBI also pays attention to rising and falling asset prices. So I have to give them credit for being one of the best Central Banks in the world.

Source : MoneyControl

Uk tax return outsourcing

London: Britain is contemplating the idea of outsourcing the process of self-assessment tax returns and other sensitive information to India and effect a saving of £200 million, a magazine claimed on Wednesday. Her majesty’s revenue and customs work is already outsourced under a long term contract, which is worth about £8.5 billion. Parisheadquartered firm Capgemini handles self-assessment tax returns and paye forms for about 30 million people. The company also deals with details of national insurance contributions for nearly everyone in Britain. The latest issue of Computer Weekly claimed that Capgemini, together with another contractor Fujitsu, is examining whether to send tax processing offshore, possibly to India. The magazine said an internal memo on the contract to staff from the public and commercial services union claimed that the companies were looking at the “potential offshoring of some future work, possibly to the subcontinent.” A report on the plan is due to be produced next month. According to a report in the Daily Telegraph, the memo said: “HMRC has asked Capgemini to draw up proposals outlining how they could contribute to the demands for better value.” Capgemini has been expanding its operations in India, where it has 18,000 of its 92,000 employees. The company has offices in Chennai, Hyderabad, Bangalore, Pune, Kolkata and Mumbai. AGENCIES

Free usa/canada calling from india

I have seen many Voip provider for free to call like skype,yahoo,MSN etc. They just provide PC to PC calling but Icall Internet phone is the one provider who offer free calling to Land line and mobile numbers of US and Canada. In case of free dialing only restricting is per call duration would be 5 minutes. If some wants to go for premium package they will charge additional $10.00 which is very reasonable for any start-up and upcoming companies as well home users who spend huge money on International calling.

If you're in the US or Canada, you can use SkypeOut to call any land line or mobile number in both the USA and Canada for free but not from India.

Icall only provides free calling to USA/Canada land line and Mobile and it also provides Access Numbers Inbound access numbers let you receive incoming calls to your iCall phone, even if you haven't purchased your own personal phone number.Just tell people to call any of the numbers below, and when prompted, enter your iCall extension. If you're logged in, your iCall phone will ring and let you know you have an incoming call! If you're unavailable, it'll forward to your free voicemail.

Next IT/ITES destination for companies during recession time

Recently Chief minister of karnataka Mr.B.S.yeddyurappa has inaugurated Rural BPO concept in Karnataka. This is an indication that there is a need to spread the benefits of IT/ITES to rural folks which will not only avoid rural educated youths migrated to Cities creating number of problems in main city like Bangalore.

Karnataka government has opened a BPO centre in this historical town near Mysore, claiming to be the first ever rural BPO centre in the country.Through opening such BPO centres, which would provide a host of utility services across the state, the government was planning to create one lakh jobs over the next five years, Karnataka Minister for IT-BT Katta Subramanya Naidu said.The state has set apart Rs 40 crore to start 100 BPO centres during this year, he said, and added that they will soon unveil new policies on IT, hardware and semi-conductor

Bangalore is over populated and there is a need to spread the concentration of IT/BPO companies to Tier-2 and tier 3 cities which will help in overall development of any state.
Take an example in Bangalore where in one who is working for IT/ITES companies are wasting minimum of 4-5 hours of their productive time in travel which has created havoc on roads of Bangalore. One cannot reach in time,none of the roads are free, Highest road accidents death,highest pollution level in the city.

Even for the companies it has become tuff during this recession time to manage the company by paying huge rent,huge salary to it's employee who in turn will need more money to lead their life in this costly city of Bangalore.

Bangalore no more can handle any addition of traffic and rental value is no more affordable and there is no value for money. Every where one can find traffic jam. I happen to visit Mysore and could able to find it as the best alternative for Bangalore.

It is also known as retired person's paradise. This city is well planned and build as per master plan of Sri.Sir.M.Vishewaraiah then Dewan of Mysore kingdom. Mysore was at one point of time was a capital city of karnataka.
One can find number of top Engineering,Medical and other management colleges in Mysore. Mysore university established in the year 1916 was one of the oldest university and education level maintained by this university is of top class.
There is no traffic congestion unlike Bangalore. It is well connected with state highway to Bangalore and very soon Mysore will be equipped with airport. What else an IT / BPO company will look for ? This is an alternative for Bangalore to develop as IT/ITES destination. There are companies in Mysore like Infosys,software paradigm,HTMT,Wipro etc.. which are running operation successfully in Mysore city.In Mysore one can just have travel distance time to reach any place not the traffic jam waiting time unlike in Bangalore. Mysore is well equipped with class one Internet service providers like Tata communication,Bharathi Airtel ltd. which will be a boon for the growth of IT/ITES companies in Mysore.As a matter of fact one can commute to Mysore in the time which they spend to commute from their home in Bangalore to their work place.

Some of the facts about Mysore next IT/ITES destination:

Mysore located at a distance of 135 Kms from Bengalooru is the second biggest city in State of Karnataka covering an area of 128 sq. kms. It is located at 770 m above sea level between 12.18° N and 76.42° E.Mysore is and has been the historical capital of the Wodeyars. The city is known for its palaces and proximityto several other places of interest like Srirangapatna, Sivasamudram Falls, and Krishna Raja Sagara Dam.Mysore, the cultural capital of the State, has many educational, commercial, administrative centres andheritage monuments. It was the home for many great musicians, music composers, dancers and Sanskritscholars. Mysore is famous for its celebration of the ten day Navaratri (Dasara) festival held every year

Mysore is one of the Tier II cities for IT & ITES along with Mangalore, Hubli - Dharwadand Belgaum.Due to aggressive promotion by StateGovt. of Karnataka, Mysore isfast catching up as the next IT Destination. Infosys has already set up its training center on a 350 Acre plotand a lot of other Major IT companies are establishing their Development Centers.

Mysore is the second biggest city in the state of Karnataka covering an area of 128 sq. kms. It is situated at140 kms from Bangalore and is well connected by rail and road to all parts of the country. In order to improve

Ring roads The road network of the city includes three ring roads viz. outer ring road, intermediate ring road and inner ring road and also arterials roads, sub arterial roads, collector roads and others. The three ring roads not only collect traffic from other roads but also act as by-pass roads at their respective locations in order to avoid congestion especially at the core of the city.

California vendors fight for their cash

NEW YORK (CNNMoney.com) -- As if struggling to stay afloat during a faltering economy isn't difficult enough, hundreds of small business vendors that rely on contracts with California are facing another hurdle: There's a good chance the state won't be paying any of their invoices this month.

After the state legislature failed to agree on budget solutions earlier this month to close a $26 billion gap, California started issuing IOUs for a variety of payments it owes -- including most of its vendor bills, personal income tax refunds, and funding for local governments. "This means that the state is casting off its cash-flow problems onto hundreds of families and small businesses in California," says Jacob Roper, a spokesman for the state controller's office.

So far, California has mailed $354 million worth of IOUs and plans to issue a total of $3 billion by the end of July. Around $140 million of the warrants are expected go to small business owners. While the state controller's office won't say exactly how many small companies will be affected, it's likely to be a big number: The state's department of general services says it holds $2.7 billion worth of annual contracts with at least 14,000 small companies, most of them California firms.

Affected business owners say they're in uncharted territory.

"We've never seen this before -- never had anything happen where we didn't get money from the state," says Gary Button, vice president of Redwood Debris Box Service in Burlingame, Calif., a firm that provides garbage and recycling containers for the state's department of transportation. State work only accounts for about 3% of Redwood Debris' business, but Button is expecting an IOU any day, which he says he will hold on to until it matures.

"I'm not going to cash it in for less than it's worth," says Button.

The state plans to redeem the IOUs, with a 3.75% annual interest rate, on October 2, or earlier if a budget deal is signed. But many small firms -- especially those that do the majority of their business with California -- can't wait that long.

"We've already been delayed by six months in payment from the state -- and now we're expecting one of those IOUs," says Gloria Freeman, owner of Staff USA, a firm in Rocklin, Calif. Contracts with the state account for 80% of her firm's annual revenue. "The real problem is not knowing how long it will take them to resolve this issue."

Staff USA provides medical staffing for various state-run divisions, and Freeman says that California owes her hundreds of thousands of dollars, much of that for services she rendered early this year. In anticipation of receiving an IOU instead of money, Freeman has laid off five employees. Searching for a new cash stream, she recently launched a new online auction business, Auction Ten, that helps consignors sell antiques and collectibles.

While she hopes that Auction Ten sales will help supplement her income, Freeman has found another use for the site. "I'll be auctioning off IOUs for people who don't want or can't redeem them via the bank," she says.

Most small businesses hope to cash in their IOUs at a bank, a process that's turning out to be difficult. Initially, all major California banks said they would honor the IOUs by charging customers a small processing fee, paying out the face value, then taking over the interest. However, the state's largest banks, including Bank of America (BAC, Fortune 500) and Wells Fargo (WFC, Fortune 500), later imposed a deadline. They stopped accepting the IOUs on Saturday.

That's a big problem for small vendors who had no hope of making the deadline because they haven't yet received the warrants they're owed. The state controller's office says there's no pecking order for issuing them; the state pays them out as bills come due.

By enforcing a deadline, the big banks hope to pressure California to make progress fast. "The message that they're sending is that the budget needs to be solved sooner rather than later," says Beth Mills, a spokeswoman for the California Bankers Association. "These banks don't want to be seen as enabling the Legislature."

Redemption options
A number of California's community banks and credit units plan to accept the IOUs indefinitely, but in many cases, the terms are tough.

"My community bank will redeem the IOU for a fee, but I have no choice but to do it," says the owner of an 11-person firm who asked not to be named. "It's not worth my while to wait for this thing to mature. I'd be losing money." His company, which does $10 million in annual business with the state, has been providing goods to prisons, state hospitals, and schools for more than 20 years. This is the first time he's been confronted with an IOU.

"If this situation continues to force us to take losses, I'll have to look into furloughing employees and laying some off," he says. Even before the latest crisis, California was firing off distress flares: Last month, he received a letter from the state asking if he would consider voluntarily reducing his company's charges by 15%.

US payroll services Outsourcing

Payroll service including tax filing is mandatory even if the form is a small or medium-sized business owner. There are so many options available.Even quick books offers two types of payroll service like Assisted payroll and Do-It-On your own payroll service.

Payroll is US is not as simple as in any other countries. There will be Federal withholding,state with holding and county with holding which need to be paid within due date failing which employer will face hefty penalty and even results in shutting the business.

There is a list of approved provider from IRS published in their site.

The following companies have passed the IRS Assurance Testing System (ATS) and/or Business Acceptance Testing (BATS) requirements for Software Developers, Reporting Agents, and Transmitters of electronic business returns to the IRS.

The Payroll Department’s responsibilities include:

•Providing cost-effective payroll processing that is accurate, timely and in compliance with University policy and all Federal and State agencies.
•Maintaining all employees’ records to ensure compliance and confidentiality.
•Ensuring all deductions, benefits and taxes are correctly deducted and reported timely to the appropriate agency.
•Attaining the most current understanding of Federal, State and University regulations regarding payroll in order to provide accurate information.

Some of the services provided by the Payroll Department are:

•Providing assistance to the university community with the resolution of operational problems related to employee’s salaries.
•Advising HR Liaisons and Managers in payroll related matters, including processing of salary actions, time and leave reporting, and related accounting and reporting.
•Maintaining a high-level of involvement and quality communication with the departments to ensure that service is responsive and supportive to their needs and goals.

http://www.irs.gov/efile/lists/0,,id=101120,00.html

Some of the services offered from payroll companies includes:

•Employee earnings statements.
•Payroll journals.
•Month-to-date department summaries.
•A notice of cash needed to cover payroll expenses and tax liabilities.
•Timely and accurate notifications of tax liabilities and deposits.
•Payroll worksheets to record your next payroll.
•Direct credit to employees bank account on the specified date.

To know the payroll due date follow the blow link:-

http://www.fiu.edu/hr/Payroll/Forms/payrollcalendaranddeadlines2009.pdf

To know the free payroll software to download follow the link:

http://www.brothersoft.com/downloads/payroll.html

If you are looking for fundamentals of US payroll you can download US master payroll guide using the link given below:

http://www.ebookspdf.com/computers/374/sap-guide-the-payroll-process/#more-374

Link to download US master payroll PDF for free using the link given below:

http://gigapedia.com/items:links?id=270719

Payroll professional looking for getting certification in payroll they can login to the following link:

The Fundamental Payroll Certification (FPC) is open to all those who wish to demonstrate a baseline of payroll competency. The FPC is designed for:

• Entry-level Payroll Professionals
• Sales Professionals/Consultants serving the payroll industry
• Systems Analysts/Engineers writing payroll programs
• Payroll Service Bureau Client Representatives

http://www.americanpayroll.org/certification/certification-fpcinfo/

These are the services which can be processed from other countries which has good understanding of accounting and payroll services. Some of the countries where US payroll is processed includes India where one can get talented youths with good knowledge in accounting and payroll services.

Next BPO destination Ireland and Switzerland offer big tax savings than the U.S. or Europe

Bangalore: At least half-dozen major corporations in the U.S. like Tyco International (TYC) and Ingersoll-Rand (IR) have proposed reincorporating in Ireland or Switzerland since October because of the U.S. President Barack Obama's plans to clamp down on corporate overseas tax maneuvering, reports Business Week.

This is because both Ireland and Switzerland offer big tax savings than the U.S. or Europe. Also, both of the countries have well-established tax treaties, which decide which country has primary taxing rights and help avoid double taxation. Paul Schmidt who heads the international tax practice at a law firm Baker Hosteller told Business Week that Switzerland's 'statutory' tax rate is 24 percent which is a huge savings over the potential 35 percent federal tax rate that the business firms could owe in the U.S. Meanwhile, Ireland has a 12.5 percent corporate tax rate and a good working relationship with the Internal Revenue Service (IRS), according to Conor Begley, an independent tax consultant and Former Director of international tax at Grant Thornton.

According to the international tax experts, the U.S. based companies would face the exit charges (taxes based on lost revenue to the IRS for future earnings) and be removed from the Standard & Poor's 500-stock index. Several companies that have "re-domiciled" have been dumped from the index. So some companies could be scared off from relocating their official bases from the U.S.

This will make US companies to move their base to Scandinavian countries and from there sub-outsource to India

Source: siliconindia

Prepare for Hurricanes by Safeguarding Tax Records

Prepare for Hurricanes by Safeguarding Tax Records

WASHINGTON — With the 2009 hurricane season now underway, the Internal Revenue Service encourages individuals and businesses to safeguard themselves by taking a few simple steps.

Create a Backup Set of Records Electronically
Taxpayers should keep a set of backup records in a safe place. The backup should be stored away from the original set.

Keeping a backup set of records –– including, for example, bank statements, tax returns, insurance policies home, etc. –– is easier now that many financial institutions provide statements and documents electronically, and much financial information is available on the Internet. Even if the original records are provided only on paper, they can be scanned into an electronic format. With documents in electronic form, taxpayers can download them to a backup storage device, like an external hard drive, or burn them to a CD or DVD.

Document Valuables

Another step a taxpayer can take to prepare for disaster is to photograph or videotape the contents of his or her home, especially items of higher value. The IRS has a disaster loss workbook, Publication 584, which can help taxpayers compile a room-by-room list of belongings.
A photographic record can help an individual prove the market value of items for insurance and casualty loss claims. Photos should be stored with a friend or family member who lives outside the area.

Update Emergency Plans

Emergency plans should be reviewed annually. Personal and business situations change over time as do preparedness needs. When employers hire new employees or when a company or organization changes functions, plans should be updated accordingly and employees should be informed of the changes.

Check on Fiduciary Bonds

Employers who use payroll service providers should ask the provider if it has a fiduciary bond in place. The bond could protect the employer in the event of default by the payroll service provider.

IRS Ready to Help

If disaster strikes, an affected taxpayer can call 1-866-562-5227 to speak with an IRS specialist trained to handle disaster-related issues.

Back copies of tax returns and all attachments, including Forms W-2, can be requested by filing Form 4506, Request for Copy of Tax Return. Likewise, transcripts can be ordered using Form 4506-T, Request for Transcript of Tax Return. Returns or transcripts can also be ordered by calling 1-800-829-1040.

There is no fee for a transcript or tax return copy for a taxpayer located in a federal disaster area qualifying for individual assistance. Taxpayers should put the assigned Disaster Designation in red ink at the top of the request form.


Source : IRS

This has striked to my mind of the service of paperlessovernight which can help one to store all their valuable documents protected at a very reasonable price which has a very good back-up facility and disaster recover plan in place.

Cosmic document management system is designed to help individuals, workgroups and large enterprises to manage their documents stored in electronic form. Document management systems provide a means to store, easily locate and retrieve, and exercise control over document-based information through the document's life cycle within the context of a group or large organization. It often includes a workflow component that routes documents to the appropriate users

• Quick and easy access to documents and data in a single view
• Control multiple document types
• Full document / Saved / Page search facility.... more details

Indian income-tax-return-filing-for free 2009

Return preparation software in Excel format has now been released for ITRs 1, 2, 3,and 4. This may be used for preparation of E-Return for AY 2009-10. The uploading of E-Returns for AY 2009-10 will be enabled shortly. Please ensure that you verify TDS/ TCS and Advance tax or Self Assessment Tax Payments using 26 AS form available on NSDL website. The same has also been sent to your email id as given in the E-Return filed for AY 2008-09. In case any entry is missing, please contact the Deductor or Bank as the case may be and intimate your PAN for correction. You may not get credit for TDS / TCS or Tax payment entries that are not available and matching with the database available with the Department.

Every new user has to register in website in order to avail the e-Filing facility. After completing the registration process and logging in, the user may download the software tools either from the download section or can use the following link to download. Based on all the relevant information the required ITR Form should be filled using the software provided. The software would generate the XML format of the return which should be uploaded on this website. On successful transmission of the return a receipt will be generated in the form of a provisional acknowledgement. Which ITR forms to file and software to download?

more details and download visit

http://www.knowinfonow.com/2009/05/indian-income-tax-return-filing-for_19.html

Disaster recovery process

Disaster recovery is the process, policies and procedures related to preparing for recovery or continuation of technology infrastructure critical to an organization after a natural or human-induced disaster.

Disaster recovery planning is a subset of a larger process known as business continuity planning and should include planning for resumption of applications, data, hardware, communications (such as networking) and other IT infrastructure. A business continuity plan (BCP) includes planning for non-IT related aspects such as key personnel, facilities, crisis communication and reputation protection, and should refer to the disaster recovery plan (DRP) for IT related infrastructure recovery / continuity. This article focuses on disaster recovery planning as related to IT infrastructure.

The terrorist attacks of September 11, 2001 have taught many businesses one thing: prepare for the unexpected. Companies must take steps to make their businesses less dependent on a single office or data infrastructure. Consider implementing technologies that can quickly duplicate company data at a remote location. Gartner Research predicts that two out of five enterprises that experience a disaster the magnitude of the World Trade Center attack will go out of business within five years. Therefore, it is more important than ever to either build a redundant IT facility, or select an IT outsourcing service provider for disaster recovery.

There are so many companies providing disaster recovery system based on the nature of business and type of activity. Each business is separate and have their own process and critically to the main function.

If we are running an e-commerce website it will always be back-up with data once in every hour in the location which is outside the location where it is originally hosted. In case of crash the back-up can be recovered and site can be made live in no time.

http://www.drj.com/vendor/drj5alt.html this site will give vendor directory of companies providing disaster recovery system.

Some of the type of recovery services includes:

• Online Backup Solutions
• Temporary and Disaster Recovery Workspace
• Emergency Telephone Diversion and Services
• Cold/Warm/Hot Site Recovery
• Access to Data Foundry's private DR Network
• Off site/Local Tape Backup and Restore
• Managed Internet Services including backup office connections
• Corporate Data Center Outsourcing
• Co location with secure cabinets, cages and private suites
• T1, T3, OC3 Connectivity with local loop management
• Backup IP Addresses

Infrastructure management services outsourcing

Infrastructure management service enables end clients to utilize services of subject matter experts, offering access to niche skills. All this provides us varied and vast experience and this in turn enables the group to have a fine balance of strength and prudence. Moving in step with the swift pace of technology and business, It will provide end to end IT Infrastructure Management services in the areas like Remote Infrastructure Management, Infrastructure Consulting, System Integration, Data center Management, Hosting services, IT help desk services, Managed security services and Desktop management.

There are many companies involved in India to cater to these requirement from other foreign countries. Major names includes Patni, TCS,Infosys etc...

F a c i l i t y M a n a g e m e n t:

• IT Infrastructure Consulting/Integration/ Management
• Security Services1 On-site services1 Maintenance Services
• Data Centre Management1 Network Management
• Server and Backup Management
• Database Management
• Messaging Services
• Help Desk Services
• Desktop Management
• Application Software Support
• Anti-virus Support
• Asset Management
• Vendor Management
• Software Version Control & License Management
• Auditing Services

A Small Business Competitive Advantage: Outsourced Finance and Accounting Solution

People often point out that small business owners wear many hats, taking on the responsibility for marketing, sales, HR, technology, and other components of the business. But any business is only as strong as the people it hires to do the work. Thus, a small business with the owner taking on tasks in many of the business areas is only as strong as the owner's capabilities in all those areas. Many find out that their strength is not in handling the finance and accounting processes.
"A lot of small business owners are great at their business, but their books are a disaster," states Devin Miller, president and CEO of Premier Payment Systems, Inc. "This causes them to make poor business decisions that could sink their business. They may even be losing money and not know it."

Miller believes that there should be no difference in the mindset between Fortune 50 companies and entrepreneurs who open up a new business in their garages. "Both need to identify their strengths and find area experts or outsourced solutions to take on everything else."
So why don't most small business owners seek an outsourced solution for managing their bookkeeping or entire financial process? First, most small business owners have someone who gives them financial advice. Typically, Miller explains, it's a CPA, and they tend to advise owners to do their own books so they'll understand the finances of the business.

That's not bad advice, says the president of Bellevue, Washington-headquartered Premier Payment Systems (PPS). "But they have to do it well. The books have to be up to date and accurate to give business owners the information they need when they need it. Otherwise, handling the books themselves will be a business liability," warns Miller.

Limitations of the standard solution

The other part of the problem is that when small business owners decide to seek help, they usually turn to local bookkeepers and find only limited, often unsatisfactory solutions. A Google search reveals a shortage of individual bookkeepers in most areas of the United States. A bigger hindrance is the fact that most of them are small business owners too; so they're not usually bonded or insured, and their business is not scalable beyond a few clients. Further, the bookkeeper must be someone the business owner can trust.

In addition, sometimes this type of solution lacks professionalism. Miller cites an example involving a client with a small retail store. Before turning to PPS, the business owner hired a local bookkeeper. But the logistics didn't work. The business lacked office space, and the bookkeeper ended up standing behind the counter during business hours, doing the books for the business with customers going in and out of the store. The store owner wasn't impressed and figured he could find a better solution with greater capabilities and flexibility.

Drivers for an outsourced finance and accounting solution

Miller explains three typical scenarios that drive small business owners to turn to companies like PPS for an outsourced solution.Business owners who recognize they are too busy and don't have time to do the books Business owners who are great at their business but realize they are weak at finances, technology, or both Business owners who understand technology, try doing their own books - but fail - and as a result often have a financial mess to clean up

A typical example of the third scenario is a small nonprofit industry association. For the two women running the organization, it was a part-time job in connection with their full-time jobs in that industry. They managed the association's books through an Excel spreadsheet. Before turning to PPS for help, the board of directors challenged the women when they were unable to reconcile the books at year end and discovered thousands of dollars were missing. PPS found the error was an invoice marked paid twice in the books.

Another company's books were in bad shape and there was an immediate need to clean up the mess. It outsourced to PPS four months' worth of clean-up work that had to be finished within three to four weeks - much more time than a small business owner would be able to dedicate to such a project, no matter how crucial it might be.

Jim Manis is an example of a successful entrepreneur and small business owner in the first scenario. He has his hand in several businesses and has started several companies. When he first turned to PPS in late 2004, he served as global chairman of an international industry trade association intent on rebuilding the organization. "We turned a dead organization with 10 members into one with over 700 members," Manis recalls. With this quick growth, they needed to be able to keep accurate track of finances, and Manis needed to be able to focus on growing the business.

Source:http://www.outsourcing-journal.com/may2009-finance.html

Search engine optimization how it works?

Search engine optimization (SEO) is the process of improving the volume or quality of traffic to a web site from search engines via "natural" ("organic" or "algorithmic") search results. Typically, the earlier a site appears in the search results list, the more visitors it will receive from the search engine. SEO may target different kinds of search, including image search, local search, and industry-specific vertical search engines.

As an Internet marketing strategy, SEO considers how search engines work and what people search for. Optimizing a website primarily involves editing its content and HTML coding to both increase its relevance to specific keywords and to remove barriers to the indexing activities of search engines.

If one wants to know any details or service provide first place they will go will be search engines... which are those search engines?????

The leading search engines, Google, Yahoo! and Microsoft, use crawlers to find pages for their algorithmic search results. Pages that are linked from other search engine indexed pages do not need to be submitted because they are found automatically. Some search engines, notably Yahoo!, operate a paid submission service that guarantee crawling for either a set fee or cost per click. Such programs usually guarantee inclusion in the database, but do not guarantee specific ranking within the search results.Yahoo's paid inclusion program has drawn criticism from advertisers and competitors.Two major directories, the Yahoo Directory and the Open Directory Project both require manual submission and human editorial review.Google offers Google Webmaster Tools, for which an XML Site map feed can be created and submitted for free to ensure that all pages are found, especially pages that aren't discoverable by automatically following links.

Search engine crawlers may look at a number of different factors when crawling a site. Not every page is indexed by the search engines. Distance of pages from the root directory of a site may also be a factor in whether or not pages get crawled

How to do SEO?

• Finding keywords is one thing, but managing them is another. Keyword management is very crucial for SEO success. For your site's content, keep track of Back links and PageRank for landing pages and other important site pages. Tools for link building help you from start to finish. Find the links, check their strength and quality, manage them from one place, and watch them over time.
• Post your website link in various directories
• Write an article about your website and make sure it gives very good information on your site
• Link Building work is what it takes for effective link building. But link building can be easier.
• Subscribe to http://www.submitterbot.com/index.php which will allow you to submit your site in different 527 directories at free of cost

India need not respond too readily to US TAX CODE CHANGE

SEVERAL MULTINATIONAL CORPORATIONS (MNCs) in the US that invest and create jobs overseas have begun lobbying against American President Barack Obama’s proposal to end their tax incentives. These firms hope to scuttle proposals on the sweeping changes in the US tax code, but their lawyers are advising them to gear up for any eventuality.
If Obama’s proposals go through, it would mark an end to tax-deferrals. US firms with foreign subsidiaries will not be able to claim a deduction for their expenses when they do not pay taxes on their profits in the US. They will also find it tough to take credit against their US taxes for foreign taxes paid on overseas profits.

More importantly, these firms cannot make their foreign subsidiaries disappear for tax purposes if the proposed reforms in check-thebox- rules — that allows them now to legally shift incomes of their subsidiaries to taxhavens — are implemented. These subsidiaries will then have to be considered as separate corporations for US tax purposes.

Tax experts admit that reforms in the deferral rules may have a rationale, but it will reduce the investment power of US multinationals. “The liberal regime helped US companies expand and grow worldwide. In a globalised world, it would be imprudent to assume that these proposals will prompt US companies to shift the jobs back home. Locational savings is a huge consideration for US companies outsourcing manufacturing and service operations. In the current state of the economy, companies will feel the pressure from their investors to optimise costs. Each government has to take a balanced approach to its tax policy. It must not hinder business and at the same time not sup-port blatant abuse of its tax incentives”, said Shefali Goradia, Partner, BMR Advisors.

The US administration, however, reckons that MNCs enjoy an unfair deal compared to firms operating only in the US who pay an overall tax of 40% on their corporate profits. The effective tax rate of MNCs, in contrast, was a mere 2.3% in 2004. They paid only $16 billion of US tax on $ 700 billion of foreign exchange earnings. US law firm Alvarez & Marsal, for instance, is ready with a list of dos and don’ts for these firms to brace up for a new tax regime. It has asked clients to give top priority to allocation and apportionment of all expenses. More so, for interest expenses that is seen as one of the most significant factors in inefficient foreign tax credit utilisation. One view is that it may be more favourable to carry debt at the subsidiary level than the parent company level. MNCs have also been advised to assess their holding company structures and exercise greater caution before making new check-thebox elections. A right mechanism to track earnings and profits of their subsidiaries is also a must. Any callousness could push the effective tax rate to 70%, say tax lawyers.

Source: Economic times

Live chat support Outsourcing

Support to customer augments trust and liberty with us. The one-on-one interaction leads our services more bolster and glue towards your old consumers. By captivating live chat services one will enjoy those customers who discard your site due to unavailability of help.

Organizations who wish to provide live help for their customers on the website can outsource live chat support services to a third party service providers.efficient live chat support executives will answer the queries of the end customers/just provide information to the visitors on your website.

Chat support services to your valued clients. With almost all the companies show-casing their products and services on the Internet, there are now several ways in which a customer contact center can assist the web visitors with live customer support services and online chat can be one of the most effective tools a modern day company can use in building efficient and cost effective customer relationships. For online live chat support services a company has to actually provide its customer with a human interface to help the customer navigate through various activities such as purchase processes, filing online domain purchase,hosting service,insurance claims, applying online for credit cards, technical support and endless other activities for which our friendly customer care executive will take your customer through all processes by providing the human interface required for an easy navigation.

Chat support service is ideal for:

• Prospecting clients
• Campaign management
• Website navigation help
• Domian management company for technical support and signing-up of services
• Online help Desk Management
• Trouble shooting support
• Live suggestion registration
• Live complaint registration
• Polling and opinion services
• Any event registration

What's the impact on IT/ITES sector from Obama's proposed tax reform?

Obama's Global Tax Raid has made talks all over the world especially in India and in particular Bangalore. President Obama on Monday spelled out his proposals to close corporate tax loopholes on U.S. multinational corporations and crack down on overseas tax havens.

Obama’s statement of "We have a tax code, "that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York." His main target was US companies having their off-shore development centre in India.

Tax deferral rules: Among the legislative proposals is a plan to reform the "deferral" rule, which lets U.S.-based multinationals deduct expenses for overseas operations, but defer paying income tax on the profits from those operations. That gets paid only if and when companies bring that money back to the United States.

Now Outsourcing will prove 50% dearer for US companies. American companies could see a 50% rise in the cost of outsourcing business processes to India if President Barack Obama’s new tax proposals is accepted. Even though outsourcing will still make business sense, industry watchers concede the move could act as a dampener.

In the current system expenditure by a US company outside the country will be treated as normal expenditure but from now onwards if Obama’s new tax proposal goes through, the company will not be able to save the $35. So the net outgo will be $100 instead of $65 — or 53.86% more than the present cost.

Obama has again invoked Bangalore to hit out at the US system. His targets are also US corporations with subsidiaries in foreign countries. These firms can defer paying US taxes on the profits of those subsidiaries until the money is transferred back to the US. “It’s a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York,’’ Obama said at a White House event.

The Obama plan unveiled on Monday would, among other things, prohibit US firms from receiving foreign tax credits on income that is not subject to US taxes. It will also end a provision that lets the firms legally shift income from one foreign subsidiary to another, thus perpetually ducking taxes. As a result, companies such as General Electric, Google, Intel, and Hewlett-Packard, all of which have operations in Bangalore, will lose tax credits and be forced to pony up more tax dollars to Uncle Sam. Whether the multinationals, which get more bang — or Bangalore — for the buck outside the United States in terms of productivity, will take this lying down is another matter. Congress has to approve the plan, and not all lawmakers are in its favor. Past attempts to pass similar laws have failed.


Obama's point, since its corporate tax rate on foreign-owned companies can be as high as 55%. The President's argument is that U.S. tax-deferral rules make it more expensive for American companies to reinvest overseas profits at home than abroad. This, he claims, creates a perverse incentive for companies to "ship jobs overseas" and reduces investment and job creation in the U.S.

This proposed tax regulation spares US based research & experimentation (R&E) companies from his proposals.

Which are the companies likely to be hit by the proposed tax plan?

Agilent

Agro Tech

American Express
Amway

Avaya

Caltex
Caterpillar

CB Richard

Ellis

Cisco
Citigroup

Coca Cola

Cognizant
Colgate Palmolive

CSC

Cummins
Discovery

Dupont

EDS
Eli Lilly

Emerson

Electric

EXL
Federal Express

Ford

Franklin Templeton
GE

General Motors

Gillette
Honeywell India

IBM

Intel
Johnson & Johnson

JPMorgan

Kellogg India
Kimberly

Clark Kodak

McDonalds
Metlife India

Microsoft

Morgan Stanley
New York Life

Ogilvy and Mather

Oracle
Pepsico

Pfizer

Pizza Hut
Sun Microsystems

Texas

Tecumseh
Timex

Tyco

UPS India

Which are the companies likely to be benefited by the proposed tax plan?

All Indian based IT/ITES companies find the detailed list http://www.bpowatchindia.com/outsourcing_company_list.html

Intuit QuickBooks Certified User Program in India

Intuit QuickBooks Certified User Program

Intuit is pleased to announce the official QuickBooks Certified User Program.
The QuickBooks Certified User Program is a Web-based certification program designed for people who use QuickBooks in their day-to-day job, including bookkeepers, office managers and owners. The program is intended to broaden, deepen and verify users' knowledge of QuickBooks Financial Software (Pro, Premier editions and Enterprise editions) through training and testing.

Benefits of the program:

Sharpen and expand your current QuickBooks and bookkeeping skills
Save time and increase efficiency by incorporating tips and tricks into your daily work
Demonstrate your QuickBooks capabilities to current and future employers
Receive a professional-looking certificate of completion
Identify yourself as a QuickBooks Certified User on the QuickBooks Community Web site

If one looking for help in getting trained and get certified as Quickbooks user just you need to pay $49.95 and attend the training conducted by cosmic IT services in india (Cosmic has been providing corporate and individuals QuickBooks training for over 5 years. Our philosophy is to provide "Quality training at affordable rates". Cosmic unlike any other training institute provides you with hands on experience.)

for more detials login to www.quickbooksindia.com

Topics & Exams
The comprehensive QuickBooks training consists of three sections. Each section includes several modules followed by an exam at the end of each section. The training is specifically designed to cover the topics you will be tested on. The exam is designed to test a broad range of QuickBooks skills, key tasks and work processes. Below is an outline of the key topics covered in the training and exams.

Section 1: Essentials for the QuickBooks User
Module 1: Creating a New Data File and Entering Historical Transactions
Module 2: Lists
Module 3: Chart of Accounts and Financial Statements
Module 4: Items
Exam: Section 1
Section 2: Day to Day Transactions
Module 1: Customers, Sales and Receivables
Module 2: Vendors, Expenses and Payables
Module 3: Payroll and Time Tracking
Exam: Section 2
Section 3: Special Topics for QuickBooks User
Module 1: Reporting
Module 2: Customizing QuickBooks and Saving Time
Module 3: Security & Multi-User
Module 4: File Utilities
Module 5: Working With Accountants
Exam: Section 3


Sample test questions:

QST.1. How do you remove transactions from a company file without deleting existing lists, preference, and service subscriptions?
a. Click the Company menu and select Clean > Company Data
b. Click the File menu and select Utilities>Clean up Company Data from the menu. Then, choose the Remove All Transactions option
c. Click the File menu and select utilities > Purge Data from the menu
d. Click the Edit menu and select Delete All Transactions

Ans: B

QST.2. Which is the correct method to adjust sales taxes due?
a. Click the Vendors menu and select Sales Tax > Adjust Sales Tax Due
b. Click the Banking menu and select Pay Sales Tax with Adjustment
c. Click the Company menu and select Make General Journal Entries
d. Open the Sales Tax Payable account register and edit the ending balance

Ans: A

Top 5 Indian BPO list

In 2002 there were few, if any, India-centric BPO vendors in the top 150 worldwide providers. But by the end of 2008, the top 20 India-centric providers accounted for $4 billion in revenue, representing 5% of the $80 billion revenue of the top 150 BPO vendors, according to research firm Gartner. Gartner analysts expect this increase in revenue to be maintained because of economic pressures that are leading to demand for low-cost BPO. And they predict that the BPO market share of Indian vendors will nearly double by 2010. Although there are still no Indian vendors in the top 20 global BPO players, half of the top 20 India-based BPO providers now operate local US and European sales and delivery centres. Indian BPO providers have had the most success servicing English-speaking requirements, from North America and the United Kingdom.


TOP 5 INDIA-CENTRIC PROVIDERS

Source: Times of india

Financial analysis services Outsourcing

Financial analysis is the key for integration and analysis of information stored in financial systems and other critical data sources across the companies. It helps managements to implement appropriate action and improve the financial solvency and liquidity of an organization. It gives faster and more accurate interpretation of financial data.

Financial analysis services is needed for timely and reliable financial planning and financial analysis solution for the smooth and successful performance of any business organization.
This service includes financial planning, financial analysis, financial statement analysis, financial accounting services, cash flow statement and balance sheet reconciliations. there are many companies in india which offer services to help overseas client in taking strategic decisions, identifying obstacles and opportunities, and providing interpretative guidance on business trends.

In a world of cut-throat competition, businessmen and organizations are posed with the demanding task of increasing profits and business volumes. Added to this, is the challenge to display compliance. To tackle these challenges, it is very crucial that advanced financial services and right information is available in time.

Advanced Financial analysis services includes

• Financial Planning
• Financial Analysis
• Preparation of MIS Reports
• Financial Statement Analysis
• Financial Accounting Services
• Balance Sheet Reconciliations
• Financial Ratios Analysis
• Small Business Financial Reports
• PreparationPreparation of Financial Statement
• Budgeting Solutions
• Generating Customized Reports as Per Requirements
• Cash Flow Management
• Preparation of Income Tax Balance SheetPreparing Monthly, Quarterly & Annual Management Reports

Finanacial analysis will provide Information for action,Business transformation,Transparency and regulatory compliance,Knowledge management within the organization,