Finance

At one point in your life, you may ask yourself why other people are so successful with money when you?re not. Depending on how closely you look, you will have several answers.

Do these sound familiar?

- They?re just luckier than I am
- They have a better education than I do
- They were born into a rich family
- They are white and have better opportunities than I do
- They already had money to start a business
- They already had money to invest in real estate
- They are smarter than I am
- They are younger than I am
- They look better than I do
- They probably work harder than I do

The list probably continues to fill several pages. Money is the topic that generates the most beliefs, followed by the topic of relationship. I once led a seminar where we investigated people?s beliefs about money. After only 30 minutes we came up with 3 full pages!

Beliefs - Blueprint of Your Reality

You may not know this yet, but your beliefs are the blueprint of your reality. If you knew that, would you deliberately create one from the list above? Probably not, because these beliefs are not supportive at all. These beliefs create a reality that leaves you ?playing? the victim, and on top of it, keeps you right where you are. You are not improving your life one bit.

Why are we creating these beliefs in the first place, when we know that they are not constructive at all? The answer lies in the nature of our consciousness. Most of us were told that there is a universe out there and this universe shapes our reality. It is the basic belief that life happens to us. Most of us get these beliefs confirmed several times per day. The result is that our consciousness gets imprinted each day with the same message. The message with the same old belief.

Meanwhile, as adults, we are not even aware that our life ?as it happens? is built around a belief. It becomes a profound reality that we prove to ourselves in each moment.

So how do we get out of this dilemma? We need to take a step back and look at our beliefs. Take a piece of paper and a pencil and write down all the beliefs you have around money. Don?t think too much, be spontaneous. When you have run out of your own beliefs, think about what other people?s beliefs are about money.

Then mark each belief with an ?I? or an ?S? depending if the belief is impeding or supportive. Impeding beliefs do not support creating wealth, supportive beliefs do. Now, look at your list and count each supportive and impeding belief. What is your score? How many impeding beliefs do you have, and how many supportive beliefs do you have?

Imprinting New Beliefs

Realize that all the impeding beliefs do not support the creation of fortune. Now, take a new piece of paper, and brainstorm beliefs that will exactly create the wealth you would like to have. When you are done with the list, go over each of your new beliefs and create a mental image. Hold this mental image for at least 10-20 seconds. You may need some practice, but every time you do it, you will get better with it. Do this exercise in a quiet, calm, and relaxed environment, as this will help to imprint these beliefs into your consciousness.

Remember, beliefs are the blueprint of what will manifest in your life. With a little training, you will be able to move on to the next stage, which is feeling your beliefs. Feel as if these new beliefs, that foster what you really want to create, have actually been manifested.

- How does it feel to be a millionaire?
- How does it feel to have abundance in your life?
- How does it feel to have more money than you can spend?
- How does it feel to give to others?
- How does it feel to buy without having to look at the price?

Whenever you catch yourself thinking or speaking an impeding belief about money, stop what you are doing. Go back to the place in your mind where you recall one of your deliberately created beliefs about money, and connect with it. The more you do this, the more you will train your mind to think in a new way. A way that leads to being rich.

By the way - this method actually uses principles of quantum physics. However, that is another story?

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Thomas Herold is the founder and CEO of Dream Manifesto. The quantum method for manifesting your dreams. To learn more about creating your dreams visit: Dream Manifesto - The Quantum Method for Manifesting Your Dreams

Today, it?s easier than ever to apply for a credit card. Banks are easing requirements and it seems that everyone, even those with no or poor credit, are credit card holders in this day and age.

The reason that credit card issuers are making it so simple to get approved is because they make substantial profits by charging these individuals higher than normal interest rates.

So, why should you tread carefully when applying for a credit card? Often times, creditcard applicants don?t read the fine print or the ?cardholder terms? and end up with cards that have big annual fees or extremely high APR?s. This is very easy to do because often times, applications are submitted over the Internet and are processed very quickly. It?s important that you carefully read all of the details before applying.

Having a credit card certainly has a host of advantages, and I am a big proponent of carrying them. However, with this newfound convenience comes new responsibilities as well.

When making purchases and charging them to your new credit card, I would recommend doing so only if you are certain that you can pay off the balance in full at the end of the billing cycle when your statement arrives in the mail. Using discipline will ensure that you don?t end up with a high credit card balance that you can?t pay off, and therefore have to pay costly interest payments on the balance.

Also, be sure that you always make your payments on time. If a circumstance arises where you don?t receive the bill in time to make your payment, simply call your credit card customer service number and inform them that the bill arrived late and payment is on the way. Typically, they?ll make sure to waive any late fees that would have been charged and note the account as not being late.

Hopefully this brief article has given you some helpful things to keep in mind as you?re applying for your next credit card. Remember, use your credit responsibly!

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For more great tips visit the Credit Card Forums at www.TheCreditCardForums.com/ now. Read reviews on gas credit cards and more! Free registration.

Defined within the realm of the statistical Bell Curve, the long tail would reside in the skinny tail at the borders. The long tail, in regards to goods and services, refers to the evolution away from mainstream offerings towards more niche products and services.

With the internet drastically reducing the costs of establishing distribution channels, the ability of entrepreneurs to focus more on the longtail sector to fit their customized needs is gaining increasing appeal.

However, almost no one speaks of the longtail of investing. To me, longtail investment strategies are the strategies that do not heavily rely on fundamental or technical analysis, but exploit other strongly predictive factors to produce not only superior returns to traditional investment strategies but also investment opportunities with far better risk-reward paradigms than those produced by traditional investment strategies. Here are 10 reasons why the longtail of investing is the only way to build wealth.

(1)You will never achieve the level of wealth you desire by handing your money over to a large investment firm.

The vast majority of private investors hand their money to large institutions and allow them to invest their money for them. If this were truly the best way to achieve financial freedom, then almost every one you know would be ecstatic with their financial consultant. Think of how many people you know that absolutely rave about their financial consultant.

The fact that 90% of people you know do not rave about their financial consultant should tell you that niche investment strategies, or longtail investment strategies, are far superior. The ones that are happy with the large investment houses already were independently wealthy before they sought out their help. Think about how many people you know that have ever told you, ?I wasn?t wealthy before, but thanks to my investment firm, I am wealthy beyond my dreams now.?

(2)Thanks to evolving information technology, there are many better and more highly predictive means of making investment decisions than just utilizing fundamental and technical analysis.

Though people have been really slow to grasp this, once they do, longtail investment strategies, like those invented by SmartKnowledgeU?, will boom. There is no doubt that the level of top-notch financial, political and corporate information available to the average investor has increased by leaps and bounds within the past decade.

There is a virtual treasure map that was created by the flattening of the world over the past decade to selecting stocks that are poised to explode. However, because the largest, most powerful investment institutions in the world have kept the masses of investors fixated on traditional investment techniques such as value and fundamental analysis, the longtail of investment strategies is currently much further behind in its developmental phases than it should be.

The best analogy I can use when explaining why people have ignored the long tail of investment strategies is to compare it to the incredibly slow adoption of Internet Protocol Version 6 (Ipv6) by the United States. When China started preparing its country for Ipv6 a decade ago, the benefits in increased security and its added value properties in e-commerce were evident even back then. However, people in the U.S. were comfortable with the lesser Ipv4 so did not take any action until the progress and superior internet and business capabilities of China, Korea, Taiwan, and Hong Kong finally embarrassed the U.S. enough to move forward and catch up with Asia.

I see the same thing happening in the educational realm of investing. Everyone is comfortable with the traditional investment strategies that have been propagated for the last several decades so nobody sees a need to move forward even though much better strategies exist today. Just as with Ipv6, the world will eventually realize that the safest and best means of investing money reside in the longtail, and they will eventually adopt these strategies.

(3)With so much investor skepticism of corporate integrity sparked by past accounting scandals at Enron, WorldCom, General Motors and the like, and the current, ongoing backdating option scandals, investors will increasingly seek alternate means of making investment decisions other than crunching numbers that they feel are untrustworthy.

Furthermore, technical analysis often yields false positives as well. A chart will show indexes that appear bullish having just broken through a ceiling of resistance only to have the index turn back downward for a prolonged period of time, or a chart will appear bearish having just broken through a floor of resistance only to turn around and begin another bullish ascent.

In fact, you have seen some of these turnaround trends with some of the technical posts that I’ve placed on my blog in previous months. In fact, that is why I always state that I never rely solely on technical indicators to make my decisions. I rely only on technical indicators to confirm or dispel what my long tail investment strategies tell me. Of the three types of analysis, fundamental, technical and long tail, long tail investment strategies yield by far the least amount of false negatives and false positives. That’s why I rely on them so heavily.

This sentiment will lead to an evolution of longtail investment strategies, and the discovery of more efficient and better predictive means of making investment decisions than even those that already exist. Even current longtail investment strategies, such as those utilized at SmartKnowledgeU? are constantly evolving as access to reliable information increases every year. Making decisions as if you were a fly on the wall of boardrooms is no longer a fantasy. It is possible, thanks to the evolution of the information landscape.

(4)With the growth of blogs and pure information sites on the web, the stranglehold of global investment myths, including the Modern Portfolio Theory of diversification, will soon be exposed for what they are ? cleverly disguised sales strategies posing as investment strategies.

Once people realize this, longtail investment strategies will gain wider acceptance, much like acupuncture and herbal medicine eventually gained credibility as healing regimens in the schools of Western medicine.

The new information age has stripped many accepted investment strategies such as diversification of much utility when attempting to build wealth. Furthermore, it has also rendered such beliefs as an inability to time the market and the efficient market model as mere myths. This has been proven time and time again by investment sites such as SmartKnowledgeU? that have called for steep market corrections in certain global markets and in asset classes like gold with consistent accuracy.

(5)Wider acceptance of alternative, longtail investment strategies that far outperform those utilized by global investment firms will happen as word of successes via these strategies spread throughout the world via the internet.

The internet distribution channel can and will be used to change the mindset of investors.

(6)The Do-It-Yourselfers are Growing ? With the success of books such as Stephen Covey?s ?The Eight Habit? that emphasize personal accountability to achieve excellence versus handing control over to someone else, cultural shifts will happen whereby people will seek to seize control over their own financial future versus just handing their money to a firm to manage.

As this cultural shift happens, multitudes of people will realize that they are shorting their returns significantly every single year by handing their money to global investment houses.

(7)The flattening of the world and accessibility to previously inaccessible investment information will undoubtedly yield an increasing amount of investment strategies that reside in the longtail.

People will realize the foolishness of believing in the one investment strategy thrust upon them by global investment houses for the past half of century as ?the only viable and safe way to invest.? If the younger generation takes an interest in investing, adding their creativity to the investment arena will result in explosive growth in the longtail of investment strategies. However, since the odds of this occurrence are quite low, a more gradual shift towards niche investment strategies is much more likely.

(8)The explosion of social networking sites like YouTube, MySpace, Friendster, Squidoo, Digg, and so forth, will amplify the viral marketing of longtail investment concepts.

Again, ignorance of longtail investment strategies causes fear and hesitancy to use them. Viral marketing of longtail investment concepts will increase millions of investors? comfort level with these different and unique concepts.

(9)People are ultimately interested in returns, no matter how much global investment firms try to separate themselves from their competitors with smoke and mirror service claims.

All the gratitude for luxury box suites at Los Angeles Lakers games, suites at the Four Seasons Hotel, conferences at world-class golf courses and resorts will quickly wither once people realize how much more money they are earning with longtail investment strategies.

(10)Again, because people will readily abandon all the perks they get as a preferred client at a large investment firm for far superior returns on their portfolios, longtail investing will eventually reach a critical mass.

Eventually the longtail of investing will migrate towards the center and become the mainstream methods of investing, though this may take several decades to occur.

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J.S. Kim is the founder and managing director of SmartKnowledgeU?, LLC. Please visit the SmartKnowledgeU? website to learn the safest places to invest money and how to achieve financial freedom

Having a high credit score can mean the difference of thousands of dollars of saved interest expense compared to others with a lower score. For example, if you improve credit score results from the credit bureaus, just a few points that increase your credit score can make huge difference in the interest rate you will pay for a home purchase.

It pays to increase your credit score!

The most commonly used credit scores available to lenders are FICO scores, which is a scoring method created by Fair, Isaac & Co…FICO!

These scores are provided to lenders by the three major credit bureaus: Equifax, Experian and TransUnion. Before we get into some tips how to improve credit scores, it pays to review the major areas that determine your FICO score.

1. Payment history on credit and retail store cards, loans and mortgages.
2. Amount that you owe. Credit agencies look at how many accounts have balances and the proportion of that balance to the credit line.
3. How long is your credit history? The longer the better.
4. New credit accounts. Applying for a bunch of credit cards all at once can hurt your score.
5. Different credit types, such as mortgages, retail loans, credit cards and installment loans.
6. How many late payments do you have?

Now, with the playing field laid out, let?s work to boost your credit score! Some methods that boost your credit score take time, months or years, and others areas to improve credit score can be made with a phone call right now! That said, here are the 7 tips to raise your credit score!

7 tips to improve credit scores

1. Pay your bills on time. Your payment history is a major factor (35% of your FICO score) in determining your credit score. If you pay your bills late, or had an account referred to collections, your credit score will take a major hit.

2. Sign up for online banking and make sure your regular recurring bills are paid automatically. This way you will not forget a payment that will wind up reducing your credit score.

3. Increase your credit limit. Another large factor is the amount of your debt in relation to your credit limit. If you have a card with a $10,000 credit limit and your balance is $9,000, this will not help to improve your score. To make the debt/credit limit ratio look better, you can try to call your credit card company and request an increase in your credit limit. Don’t use the extra credit though! That defeats the whole purpose and puts you further in debt!

4. Don’t apply for many cards at once. This will not improve your credit score because this is a characteristic of high credit risk groups.

5. Don?t ever close an open credit card account. If you pay off a credit card down to a zero balance, leave it open. Remember that a positive factor for your credit score is how much available credit you have at your disposal when compared to your credit balance, in addition to the length of your credit history.

6. Apply for loans within a two-week period. Every time you request a loan and the lender pulls your credit report, it can hurt your score. It is part of the FICO formula that reasons “this person is trying to apply for credit and loans and possibly be trying to live way beyond their means!” If you keep the loan process within a two-week period, all of the credit report lookups are bundled together as one single request!

7. Check for errors on your credit report. Examine your credit report for errors and contact the credit reporting agencies to fix any errors on your credit report.

If you take action and follow these tips, you will be able to give your credit score and immediate boost and gradually increase it even more as time passes. The major keys are to pay your bills on time and reduce your debt amounts when compared to your credit limit. This has a twofold benefit of improving your credit score and reducing your debt.

Copyright ? 2005 FinancialTipsForYou.com

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Greg Quincy is the publisher of the website www.financialtipsforyou.com, offering his insights and personal finance budget tips that he has gained from working in the financial industry and the economic challenges of raising a family.

If you are a merchant with an existing echeck processing service, you learn that receiving paper check payments is a breeze. Just convert the checks to electronic form and then click ? Send?.

In a matter of days, you will soon have the full check amount deposited in your account. Under ideal condition, of course. Meaning, the customer transacts honest business with you and has adequate funds in his checking account.

But wait . What if the check contains no sufficient fund, or that it is a fraudulent one? These things happen daily in the business world, you know. Some are done inadvertently because sometimes the check writer does not know his or her checks no longer have sufficient funds. Others are perpetuated by deceitful customers. You will incur losses if you are not alert to these unfortunate incidents.

Protect yourself against such unlikely events by subscribing to additional echeck services. These are :

1.)CHECK VERIFICATION
A customer walks in to your store, selects items, and then issues a check as payment for his purchases.
Unknown to you, this particular customer has a history of issuing bad checks. If you don’t have check verification service, you would have gladly accepted the check and incur losses.
But with check verification service, you run the check into your POS terminal and, in a matter of seconds, you will receive a warning message that this particular checking account has been placed on a red status. You can then act accordingly based on that alert message.
Check verification service is basically running a check against a nationwide database of checking accounts. It scans checking accounts and gives warning message against customers that have issued bad checks in the past.

2.)CHECK GUARANTEE
For a very minimal fee, check guarantee is a service where the checks you received are checked against a negative database and thus protect you, in real time, against bad and fraudulent checks.
It offers an extra layer of protection for the merchants.

3.)CHECK COLLECTION
This is another type of useful echeck processing service. Suppose you have a customer who issues a check payment for you. At the moment of writing that check, the customer has enough funds in his checking account. But when the bank tries to debit the amount, his checking account no longer has sufficient funds. In other words, the check bounces.
If you have check collection service, the bank will forward the bounced check to your processor. The processor, in turn, will send it to the collection team who will personally get in touch with the issuer through mails or telephone calls to collect the face amount of the check for you.

4.)CHECK RE-PRESENTMENT
If you receive any bad checks, your bank will send them to your processor. Your echeck processing company will present the check again for two times, or re-present them, to the Automated Clearing House until you get the payment. The amount is credited to your bank account.

Merchants will surely gain a lot by subscribing to these extra echeck processing services.

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Kay Fione is an established consultant for business professionals and high risk merchant account providers, among them eCheckProcessing.biz. She finished her PhD in Business Management at the University of Massachusetts. She has also taken Creative Writing course specializing in business writings and reviews. Ms. Fione lives in Ross County, Ohio. She also conducts lectures around USA and Asian regions.

1. Negative Spending
Have you created a budget and do you stick to it? If not, you may be spending more money than you make. People who have created a budget have a good idea of their monthly income and expenses and can accurately diagnose their financial condition.

Other signs of negative spending include the inability to pay off credit cards each month and spending money on fun things before you have paid for necessities.

2. No Rainy Day Fund
Do you have little or no money in savings accounts, retirement plans, and investment portfolios? When something breaks, or difficult circumstances such as unexpected medical expenses or a job loss happens you must draw down what little savings you have and go deeper into debt.

3. Too Much Debt
Do you have so much debt that you are having difficulty meeting your expenses each month? Are you ?borrowing from Peter to pay Paul’? You may have re-financed your home or consolidated debt to get cash to pay for other debts (maybe more than once). Re-financing or consolidation can be a very good tool to help you, but the ultimate goal must be to reduce debt.

4. No Plan
Do you have a written financial plan, to help you plan for unexpected things and future goals? A comprehensive financial plan used to be difficult to come by unless you had substantial assets, but with a financial plan you can take control of planning your future.

5. Optical Rectitus
The condition in which your optical (eye) nerve gets crossed with your rectal (anal) nerve and you see the world through a crappy disposition. You can choose to be negative or positive. Whichever one you choose will set the course for your life. You can either make the best of what you have, or be a victim of circumstances and spend your life blaming others for your situation. Having a positive attitude creates the state of mind for success and overall health.

6. Self-Centeredness
You live mainly for yourself without thinking of the world around you. You buy things that please you alone, and then you don’t share. For instance, what good is it to buy a new gas grill then never have a cookout? You are enjoying your holiday meal without even a thought about donating to a soup kitchen or food pantry. Your children are enjoying opening their holiday gifts, but you didn’t think about donating a gift for a needy child. You don’t give money and time away. You spend your time and money on yourself, or on those in your very small circle. You will find liberation if you think of others and ?higher things’ before thinking about yourself. Giving money away can be the best “investment” in how you feel about yourself and the world around you

7. You and Your Spouse Don’t See Eye-to-Eye on Money
Perhaps one of you is a procrastinator and spender and the other is a saver and has a ?get-er-done’ attitude about finances. This problem can be overcome, but it requires a lot of work from both of you. Financial counseling may be in order in extreme situations. Sometimes separate checking accounts, but joint savings and investments can help. Creating and sticking to a budget is essential so that the ?spender’ isn’t always blamed for financial difficulties. Also, remember that a lot of marriages break up over fighting about financial matters. The small amount of time planning and working through financial responsibilities is well worth marital harmony.

8. Either Trust Too Much or Don’t Use Advisors at all
You assume that anyone can make financial decisions and that everything will work out in the end. You don’t keep up with the news so you were unaware of things such as predatory lending practices on your ?interest only’ mortgage or the 400% interest you paid to the ?Get Cash Now’ store. You are certain that the odds are truly in your favor to win this time so you are buried in magazines that you bought to increase your chances to win. Your basement is filled with products that you will sell someday; you just had to get the minimum amount so that you could be an official distributor and save more money. Remember, if it seems too good to be true it probably is.

Have you put off seeking help from financial, insurance, legal and tax advisors. Many people procrastinate to the detriment of their financial condition. We all have to pay taxes and we all need insurance and a will. Perhaps you don’t want to make the hard decisions that they may tell you to make (like saving more money and buying insurance, or delaying the purchase of things you want now). Tax and legal advisors may save you money and legal entanglements.

9. Living Large
Do you spend money on homes, cars, vacations, or hobbies at or a level above your income bracket versus a notch or two below? Bigger homes, and cars, more sophisticated appliances or whatever you buy, will cost more to purchase, fuel, maintain and insure. The nicer vacation spot will cost you more for your lodging, meals, and for everything else while you are there. Have you ever allowed warm fuzzy feelings to dictate the purchase of a pet without properly budgeting for all of the expenses it would entail? Don’t buy anything if you can’t afford all of the expenses that will come with it.

10. Laziness
For some, the desire to pay bills, budget, and plan finances falls somewhere below getting a root canal without anesthesia. Sometimes procrastination or a desire to avoid difficult topics (like thinking about your death for Life Insurance or creating a Will) can keep you from achieving your dreams.

Being successful with the money you have is not easy or quick and there are no short cuts. Continue to educate yourself about financial matters and obtain and follow a financial plan. If you work hard to achieve the goals laid out in your plan and avoid these mistakes you will be well on your way to funding your dreams.

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Kent E. Irwin, ChFC, CLU, CAP, co-founder and CEO of eFinplan.com. eFinPLAN is the first and only web-based comprehensive consumer financial planning software designed for people who are trying to do a lot of their own financial planning. Find out more about how do-your-self financial planning at eFinPLAN.com

Statistics on franchising are astounding for the period 2005-2006 in the US there were approximately 1500 brands franchised with more than 767483 outlets with a turnover of USD62460 billion.

The figures are an indication that franchising is an accepted concept that is profitable.

All over the world people are choosing to run franchises instead of floating new businesses as with franchising all the basic market surveys, research, and business plans are already in place and working. So, entrepreneurs young and old choose to become franchises of a running and profitable chain and be their own bosses. If working for a company is not your cup of tea then consider franchising as a business module, it has many benefits:

1. When you take up a franchise you are taking on a business that is already flourishing. The business module is complete in all respects and any problems have been ironed out by the person who first established the business. What you get is a ready made package that just needs to be run.

2. By franchising you get not just a business by all the support you need in terms of marketing, customer relations, accounting, staff training and deployment, as well as in the day to day running. You become part of a local or global group that networks and interacts on all aspects of the business.

3. Solutions to hitches or problems encountered in business are always on hand, the franchise chain will lend complete technical support and any other assistance required. The chain will function as a single unit as far as technology, machinery, group branding, and advertising and so on is concerned.

4. The progress or expansion in the business will occur as a collective group and professional consultancies and so on will be carried out for the whole group of units. This means the think tank is much large as also the resources.

5. Aspects like future plans, product research, buying power, expansion of activities, market surveys, and more will be done as a chain and so you will just reap the benefits. The risk will be collective and not individual as in other business modules.

6. You will be your own boss and be working towards securing your own future. The devotion and long hours will help you reap many benefits and respect.

7. With franchising your staff would be trained by the franchise major and so what you will get is people who can function well without constant supervision and watching over. As the world innovates your business will keep abreast of the changes.

World wide business gurus advice that ?a franchising business module is the safest and most dependable choice in business entrepreneurship.? A franchise can make dreams come true of owning and running your own business without the accompanying heartaches.

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Artaza Burrows is a retired Franchise Agent and a writer for www.1866franchise.com , the premier website to find free search for food franchise, franchise latest industry updates, franchise opportunity, best franchises, real estate franchise, franchise direct, franchising service providers, top franchise, franchise opportunities, franchise listings and many more.

After years of conducting tens of thousands of successful 1031 exchanges, we found that there are a number of frequently asked questions related to this type of transaction?

Equity and Gain

Is my tax based on my equity or my taxable gain?

Tax is calculated upon the taxable gain.

Gain and equity are two separate and distinct items. To determine your gain, identify your original purchase price, deduct any depreciation which has been previously reported, then add the value of any improvements which have been made to the property. The resulting figure will reflect your cost or tax basis. Your gain is then calculated by subtracting the cost basis from the net sales price.

Deferring All Gain

Is there a simple rule for structuring an exchange where all the taxable gain will be deferred?

Yes, the gain will be totally deferred if you:

1) Purchase a replacement property which is equal to or greater in value than the net selling price of your relinquished (exchange) property, and
2) Move all equity from one property to the other.

Definition of Like-Kind

What are the rules regarding the exchange of like-kind properties? May I exchange a vacant parcel of land for an improved property or a rental house for a multiple-unit building?

Yes, “like-kind” refers more to the type of investment than to the type of property. Think in terms of investment real estate for investment real estate, business assets for business assets, etc.

Simultaneous Exchange Pitfalls

Is it possible to complete a simultaneous exchange without an intermediary or an exchange agreement?

While it may be possible, it may not be wise. With the Safe Harbor addition of qualified intermediaries in the Treasury Regulations and the recent adoption of good funds laws in several states, it is very difficult to close a simultaneous exchange without the benefit of either an intermediary or exchange agreement. Since two closing entities cannot hold the same exchange funds on the same day, serious constructive receipt and other legal issues arise for the Exchangor attempting such a simultaneous transaction. The addition of the intermediary Safe Harbor was an effort to abate the practice of attempting these marginal transactions. It is the view of most tax professionals that an exchange completed without an intermediary or an exchange agreement will not qualify for deferred gain treatment. And if already completed, the transaction would not pass an IRS examination due to constructive receipt and structural exchange discrepancies. The investment in a qualified intermediary is insignificant in comparison to the tax risk associated with attempting an exchange, which could be easily disqualified.

Property Conversion

How long must I wait before I can convert an investment property into my personal residence?

A few years ago the Internal Revenue Service proposed a one-year holding period before investment property could be converted, sold or transferred. Congress never adopted this proposal, so therefore no definitive holding period exists currently. However, this should not be interpreted as an unwritten approval to convert investment property at any time. Because the one-year period clearly reflects the intent of the IRS, most tax practitioners advise their clients to hold property at least one year before converting it into a personal residence.

Remember, intent is very important. It should be your intention at the time of acquisition to hold the property for its productive use in a trade or business or for its investment potential.

Involuntary Conversion

What if my property was involuntarily converted by a disaster or I was required to sell due to a governmental or eminent domain action?

Involuntary conversion is addressed within Section 1033 of the Internal Revenue Code. If your property is converted involuntarily, the time frame for reinvestment is extended to 24 months from the end of the tax year in which the property was converted. You may also apply for a 12-month reinvestment extension.

Facilitators and Intermediaries

Is there a difference between facilitators?

Most definitely. As in any professional discipline, the capability of facilitators will vary based upon their exchange knowledge, experience and real estate and/or tax familiarity.

Facilitators and Fees

Should fees be a factor in selecting a facilitator?

Yes. However, they should be considered only after first determining each facilitator’s ability to complete a qualifying transaction. This can be accomplished by researching their reputation, knowledge and level of experience.

Personal Residence Exchanges

Do the exchange rules differ between investment properties and personal residences? If I sell my personal residence, what is the time frame in which I must reinvest in another home and what must I spend on the new residence to defer gain taxes?

The rules for personal residence rollovers were formerly found in Section 1034 of the Internal Revenue Code. You may remember that those rules dictated that you had to reinvest the proceeds from the sale of your personal residence within 24 months before or after the sale, and you had to acquire a property which reflected a value equal to or greater than the value of the residence sold. These rules were discontinued with the passage of the 1997 Tax Reform Act. Currently, if a personal residence is sold, provided that residence was occupied by the taxpayer for at least two of the last five years, up to $250,000 (single) and $500,000 (married) of capital gain is exempt from taxation.

Exchanging and Improvements

May I exchange my equity in an investment property and use the proceeds to complete an improvement on a vacant lot I currently own?

Although the attempt to move equity from one investment property to another is a key element of tax deferred exchanging, you may not exchange into property you already own.

Related Parties

May I exchange into a property that is being sold by a relative?

Yes. However, any exchange between related parties requires a two-year holding period for both parties.

Partnership or Partial Interests

If I am an owner of investment property in conjunction with others, may I exchange only my partial interest in the property?

Yes. Partial interests qualify for exchanging within the scope of Section 1031. However, if your interest is not in the property but actually an interest in the partnership which owns the property, your exchange would not qualify. This is because partnership interests are excepted from Section 1031. But don’t be confused! If the entire partnership desired to stay together and exchange their property for a replacement, that would qualify.

Another caveat. Those individuals or groups owning partnership interests, who desire to complete an exchange and have for tax purposes made an election under IRC Section 761(a), can qualify for deferred gain treatment under Section 1031. This can be a tricky issue! See elsewhere in this publication for more information. Then, only undertake this election with proper tax counsel and only with the election by all partners!

Reverse Exchanges

Are reverse exchanges considered legal?

Although reverse exchanges were deliberately omitted from Section 1031, they can still be accomplished with the aid of an experienced intermediary. Since reverses are considered an aggressive form of exchanging, your intermediary and tax advisor should assist you with exchange and tax planning based upon successful reverse exchange case law.

The Taxation Section of the American Bar Association has submitted suggested guidelines for the IRS in evaluating reverse exchanges and issuing new regulations. Although it is unknown when the IRS will make a definitive reverse exchange ruling, one is expected in the future.

Identification

Why are the identification rules so time restrictive? Is there any flexibility within them?

The current identification rules represent a compromise which was proposed by the IRS and adopted in 1984. Prior to that time there were no time-related guidelines. The current 45-day provision was created to eliminate questions about the time period for identification and there is absolutely no flexibility written into the rule and no extensions are available.

In a delayed exchange, is there any limit to property value when identifying by using the 200% rule?

Yes. Although you may identify any three properties of any value under the three property rule, when using the 200% rule there is a restriction. It is when identifying four or more properties, the total aggregate value of the properties identified must not exceed more than 200% of the value of the relinquished property.

An additional exception exists for those whose identification does not qualify under the three property or two hundred percent rules. The 95% exception allows the identification of any number of properties, provided the total aggregate value of the properties acquired totals at least 95% of the properties identified.

Should identifications be made to the intermediary or to an attorney or escrow or title company?

Identifications may be made to any party listed above. However, many times the escrow holder is not equipped to receive your identification if they have not yet opened an escrow. Therefore it is easier and safer to identify through the intermediary, provided the identification is postmarked or received within the 45-day identification period.

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This article brought to you by Nationwide Exchange Services. Nationwide Exchange Services (NES) is a leading provider of 1031 tax deferred property exchange products and services. Learn more about 1031 Tax Exchanges.

Accounting forms the crucial aspect of any business as the entire status of a businesses profit or loss is decided on the basis of the accounts that it maintains.

Every transaction that a business bears has to be recorded in various accounting records such as a balance sheet, journals, ledgers and profit and loss statements. The details of the financial transactions enable the accountants to come to a conclusion about the current standing of the business on any given date. A business has a specific accounts division to handle all the dealings of the company wherein even the petty cash is accounted for by the business. However as the work increases with the expansion of the company the business may also look at hiring a vendor for accounting outsourcing services.

Accounting outsourcing services are provided by many reliable vendors who have a host of competent professionals who can be allotted the work of individual clients. The professionals working with an accounting outsourcing services provider are well qualified to handle every kind of accounting software that is available in the market. The client can therefore rest assured that their accounting work will be carried on by the outsourced vendor in a manner that is similar to the in-house accounting processes. The advantage of hiring an accounting outsourcing services vendor can be manifolds and cost reduction for the client is a major reason. The fees that is to be paid to the vendor for his services comes out to be much lower than the salary that would otherwise have been paid to an in-house accounting staff that the company would hire.

The cut down on financial resources by hiring an accounting outsourcing services vendor is reflected in the increased profit of the company. Also the client can be assured of well maintained and absolutely accurate financial records being maintained by professional accountants. This enables the client to have ready access to his financial records at a moment?s notice. Financial decisions that are made by the decision makers and the top managerial staff regarding the growth, expansion and business strategies are all determined on the basis of these reports that are prepared by the vendor hired for accounting outsourcing services. Hence, crucial importance is given to the accuracy and secrecy of maintaining the financial accounts.

Accounting involves the monotonous task of matching the financial transactions that occurs in the day to day workings of a company with the actual balance available. However it is a critical task that each business needs to undertake and hence only professionally qualified accounts can be handed the task of maintaining such accounts. The maintaining of accurate accounts all year round by the accounting outsourcing services provider enables the business to be prepared to file their taxes at a moment?s notice, thereby avoiding the mad scramble for organizing details at the last minute. Also the perfectly balanced and maintained accounts provide the company with the much needed transparency in all business dealings with the investors and the public in general.

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Michelle Barkley is a CPA who advises people on tax preparation and tax calculation.She specializes in bookkeeping outsourcing,Tax return preparation,back office outsourcing and Outsourced Accounting.To know more about Accounting outsourcing services,
accounting outsourcing in India and to use the services visit www.ifrworld.com.

Home based businesses to earn extra income have become widely accepted all over the world are spreading like forest fire. They have become most desirable businesses to start for apparent reasons:

Imagine how it would feel to get up at your own sweet time and not hurry to office in the regular chaos of snarling traffic all the while getting choked on pollution.

And then, to begin the day as though you are fresh form home and nothing has happened. Listen to the Boss ordering you around and giving you the grind for deadlines.

Extra Income has not hurt anyone up to now, and it should not be hurting you either. If you are willing top do that extra bit of work or travel that extra mile for your boss, I am sure you will be more than willing to do so for yourself, especially if you feel that it would improve the quality of life of you and your family.

Extra Income does not come for free. It involves hard work but of the kind you would want to do. It is not hard work when you are doing what you always wanted. A little bit of inspiration could get you off the mark, wouldn?t it? Let?s get going point wise;

1. You will be your own boss with no one looking over your shoulder. Freedom of time, moment, goals, finances everything left to you.

2. Work at your convenience. Be your own time master. Flexibility benefits are more for mothers and people having other responsibilities apart from profession.

3. Flexibility to do whatever you want to do, whenever you want to do it.

4. The above factors help you to pursue your regular income job until you are sure of the extra income business. You can always switch.

5. Job security and fear of unemployment vanish.

6. Sense of pride. Make you more of a complete person who can proudly say that he/ she is an entrepreneur who has achieved something.

7. Self confidence going through the sky. This factor will help you face most hurdles in life with a lot lesser heartaches and stress.

8. Limitations of earning do not exist. You can earn as much as you want by just stepping up the speed.

9. Many countries offer tax benefits for home based businesses, since it is considered extra income. So greater credit ratings with lesser tax obligations.

10. You can retire at your own time, at 30 or at 60, it?s entirely up to you.

Success becomes a commodity which you can measure with your own yardstick rather than others, which contributes a lot to your personality and the finances through the extra income you earn. The above reasons are certainly worth a glance if you are considering being successful and independent in life.

Analyze the above points on a piece of paper before making your decision on whether you want that extra income or not.

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John Ugoshowa. You are welcome to use this article on your website or
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