Monday, February 24, 2014

Boost Your Tax Refund By Itemizing Deductions

BARRY LISAK for the ChiefLeader.com writes: Generally, you must decide whether to itemize or to use the standard deduction on your income tax return. You should itemize if your allowable itemized deductions are greater than your standard deduction. The taxpayer must maintain the records and receipts to substantiate the itemized deductions. All deductions are reported in the tax year in which the eligible expenses were paid.
Effective for the 2013 tax year, itemized deductions will be reduced or phased-out (called the “Pease”) for single taxpayers whose adjusted gross income (AGI) exceeds $250,000 and married filers whose AGI exceeds $300,000. The total amount of itemized deductions is reduced by 3-percent by which the taxpayer’s AGI exceeds the income threshold amount, with the reduction not to exceed 80-percent of the allowable itemized deductions.

You may benefit from itemizing your deductions on Form 1040, Schedule A if you:

• Had large, uninsured medical and dental expenses. Payments for doctors and dentists, premiums for medical insurance, payments for prescription drugs, and medical transportation are considered. Effective for the 2013 tax year and beyond, if you are under 65 years of age, you can deduct health costs on your tax return for yourself, your spouse and your dependents only when the expenses exceed 10-percent of your adjusted gross income (AGI). The types of medical expenses are constantly expanding as new tax and IRS court decisions are rendered. It may be wise to check for specifics with a tax professional.

• Had state and local income taxes withheld from your wages or paid estimated state taxes. Real-estate taxes, personal property taxes, and state and local sales taxes fall into this tax-deductible category.

• Paid mortgage interest on your principal and/or vacation home, or private mortgage-insurance premiums. Also, points paid on a new home and investment interest can be deducted. Personal credit-card interest is not deductible.

• Made large contributions to qualified charities. Both cash and noncash (usually clothing) items are considered. If noncash items exceed $500, you must attach IRS Form 8283, Noncash Charitable Contributions. One can deduct charitable donations only if you itemize your tax return.

• Had large, uninsured casualty or theft losses. You are allowed to claim only the amount that exceeds 10-percent of your AGI after subtracting $100 for each casualty loss on your return. Losses due to Hurricane Sandy may be eligible for casualty-loss deductions. You claim your casualty or theft losses on IRS Form 4684, Casualties and Thefts.

• Had miscellaneous and employee deductions that exceeding 2-percent of AGI. Examples include union dues, fees paid to tax preparers, and investment expenses.

• Had gambling losses, but only to the extent of gambling winnings. For example, a person wins $3,000 in certain gambling activities and loses $3,500 in other gambling activities can deduct only $3,000 of the losses against the $3,000 income, resulting in a break-even gambling activity. The remaining $500 excess loss is not deductible.

Itemized deductions allow taxpayers to reduce their taxable income and thereby pay less in taxes. If you incorrectly filed your return using the standard deduction and want to change to itemized deductions, you may do so within a three-year period allowed for amending your return.

Caution: If you are married and filing a married filing separate return and your spouse itemizes deductions, then you are also required to itemize on your tax return.

Posted on 10:34 AM | Categories:

7 Tax Apps for Small Businesses

Brett Nuckles for Fox Business/Business News Daily writes: Tax season can be tough for small business owners. Filing your taxes yourself is a time-consuming chore, and hiring an accountant is expensive. But with your smartphone or tablet, and the right apps, you can be well on your way to a stress-free tax day. 
Your mobile device can ease the process by managing your receipts, tracking your deductions and automating the process of filling out tax forms. It takes the guesswork out of the filing process, and saves you money by eliminating the need to hire a professional. Read on for 7 mobile apps to help you get started.
H&R Block Mobile – iOS, Android (Free)
The H&R Block Mobile app makes it easier to file your taxes, by connecting you directly to tax professionals. Basically, the app lets you upload your documents and send them to a tax pro. It can create a personalized checklist of required documents, and lets you view tax returns from previous years. If you need to schedule a face-to-face meeting with an H&R agent, the app can also help you find the closest office in your area. Additionally, the app lets you check the status of your federal tax return, and estimate the amount of your return with a built-in calculator.
H&R Block 1040EZ – iPad (Free)
While the H&R Block Mobile app focuses on connecting you with tax professionals, H&R 1040EZ instead helps you e-file your taxes independently. To use the app, you snap photos of the necessary documents, then file the information. It's free to prepare your taxes, but e-filing costs $9.99. The app checks for mistakes so you can correct errors and omissions, and customer service agents are available for live support if you need it. Additionally, with the 1040EZ app, you can easily view prior tax returns if you've used H&R Block before.
TurboTax - iPad (Free)
TurboTax for iPad walks you through the process of filing your taxes. Here, again, you snap a photo of your tax documents; the app then coaches you through every step of the filing process, double-checking to ensure that you have entered all information correctly. TurboTax also checks for deductions and credits, and once your return arrives, it gets stored in the TurboTax Cloud. If you have questions, you can request assistance from a live agent right within the app. TurboTax is free to download, but it costs $29.99 for federal tax return filing and an additional $36.99 per state for state tax filing.
TaxCaster – iOS, Android, Windows Phone (Free)
The lightweight TaxCaster app helps you estimate your tax refund on the fly. Just enter the basic information about your lifestyle and business, and TaxCaster will estimate what you owe, and how much you can expect to get back. The app uses the same tax calculator you'll find in the desktop version of TurboTax to provide the estimates before you even file your taxes. Based on the information you provide, it can also recommend a product to help you complete the filing process.
Shoeboxed - iOS, Android (Free)
With Shoeboxed, keeping your receipts, bills and other financial documents organized is as easy as snapping a photo. Once you upload your document via the Shoeboxed app, it automatically extracts the important information, such as vendor, date, total and payment type. This creates a fully searchable digital database of your transactions. For small business owners, Shoeboxed will pay off in a major way at tax time. The app can save you time and money; managing paper documents yourself is time consuming, and hiring someone else to do it is expensive.
Evernote – iOS, Android, Windows Phone (Free)
More than just a robust note-taking tool, Evernote also offers a way to manage the documents you'll need to file your taxes. Because Evernote lets you easily store and organize images, you can scan in your receipts and then trash them. And because the app can read printed text, it's easy to search for a specific receipt. You have a few options for getting your receipts into Evernote. First, there's the pricey ScanSnap scanner, made by the Evernote developer, which directly scans in high-quality images and automatically uploads them to your Evernote account. For a cheaper solution, try the DocScanner app for iOS and Android, which you can use to "scan" in receipts by snapping a photo with your smartphone or tablet.
IDonatedIt – iOS, Android (Free)
Charitable donations are tax-deductible expenses. They reduce your taxable income and ultimately lower your tax bill. But tracking your donations throughout the year can be a chore. A mobile app called iDonatedIt streamlines the process by helping you document your donations quickly and easily. Just open the app when you donate a non-cash item to charity to track the donation date, the charity you donated to and the fair-market value of the item. By tax day, you will have a complete and permanent record of donated items that meets IRS compliance requirements. You can also attach photos of donated items and email the detailed donation report to yourself or your accountant.
Posted on 10:29 AM | Categories:

Cloud analytics service serves up QuickBooks intelligence / The new solution from InsightSquare analyzes cash flow, customer churn and other strategic metrics.

Heather Clancy for ZDNet writes: InsightSquared, which provides analytics and business intelligence for Salesforce deployments, has added a new service focused on reporting metrics from your QuickBooks accounting application.



Details_Invoices_1


The cloud-delivered service allows small-business owners or managers at midsize companies to forecast cash flow, identify customers that might be at risk of churn, or analyze outstanding bills, invoices or expenses. InsightSquared can provide a unified, visual view of data from multiple sources, helping associate information across QuickBooks and Salesforce, for example. (The dashboard is shown above.) 
The alternative to this has traditionally been downloading data to Excel and then running reports from there or asking an accountant to run the numbers. But this makes that information more accessible.
"I like to look at the trending charts and also drill down into the current and previous months," said Paul Nadjarian, founder and CEO of Mojo Motors, one early user. which is a car-shopping site. "With InsightSquared, the reports and graphs are readily available, and because I am able to look at them daily, I do."
This is not an inexpensive service: it's priced starting at $200 per month for managing data from QuickBooks; it costs more for additional data sources. That's on top of the $75 per month per user (for the Standard option) that your company will already be paying for the Salesforce metrics that are at the heart of this service.

Click Here To Visit Insightsquared Quickbooks Integration
Posted on 10:19 AM | Categories:

Franchises Smartly and Easily Consolidate Financials in the Cloud With Xero and Qvinci Software

Xero, the global leader in online accounting software, and Qvinci Software, the leading financial-reporting solution for franchises and multi-unit enterprises, today announced the integration of their cloud platforms to deliver accounting, consolidated reporting, and business intelligence in one seamless, easy-to-use solution.
The partnership will allow Xero customers (with one or more businesses in Xero) to connect and sync all their financial data with Qvinci. Data within Xero will be consolidated and instantly visible in Qvinci, in a format that is clear and usable for better, smarter management.
Xero users syncing just one business with Qvinci gain access to a user-friendly management dashboard showing key financial data in a visual format. Users with multiple businesses on Xero (including franchisors) can consolidate financials from all their businesses in seconds, compare businesses side-by-side, and benchmark against the best-performing businesses in their ecosystem. All Xero users can use Qvinci to run numerous reports, identify operating and financial problems, set early-warning alerts, and receive email reporting on virtually any device.
"Both Xero and Qvinci were designed from the ground up as highly-secure, cloud-based applications, to give users anytime, anywhere access through SaaS subscription models," said Charles Nagel, CEO of Qvinci Software. "Both companies provide customer-centric solutions -- that means fast and secure access, easy-to-use interfaces, intuitive design and navigation, as well as reports that are immediately understandable and usable. It wasn't hard to see the fit and the benefits we could deliver to small businesses and their accountants and bookkeepers."
Xero users can now take a Qvinci account (choosing from among Qvinci FREE, MULTI, or ENTERPRISE), connect online to Xero, and enjoy automatic syncing of their Xero data in Qvinci. There's nothing to download. To get started, contact Xero or Qvinci Software, or simply click this link: http://www.qvinci.com/sync/xero.
"Simplifying the lives of our customers is something that we strive for constantly, which is why we see this partnership with Qvinci as a great fit," said Jamie Sutherland, president, Xero U.S. "Combining both cloud platforms gives our users a simple way to view and take action on their business data -- no matter how complex -- all while strengthening our partner ecosystem."
About Xero:
Xero is beautiful, easy to use online accounting software for small businesses and their advisors. The company has over 250,000 paying customers in more than 100 countries around the world. Recently Xero garnered a five-star review for Software As Service from CPA Practice Advisor. The Xero US team is headquartered in San Francisco. Xero is hosted with Rackspace in Chicago.
To gain insight on how to grow your small business, visit Xero's Small Business Guides.
About Qvinci Software and Qvinci®:
Qvinci Software is the creator of Qvinci®, an industry-leading, highly-secure, cloud-based solution that automatically collects and consolidates in seconds an unlimited number of QuickBooks®, Excel®, Xero®, and MYOB® files, wherever located, in an enterprise-class interface that gives the user a vast array of tools to analyze and act on the data, for better decisions, competitive advantage, and improved profitability.
Qvinci is a registered trademark of QuickDash, LLC, dba Qvinci Software.
Posted on 10:17 AM | Categories:

Why would anyone opt for desktop accounting over cloud?

Stephanie Zillman for Dynamic Business writes: So why would any business opt for the desktop option, when the advantages of cloud are shouted loud and clear from the likes of Xero, MYOB, Intuit and Reckon, and more?
Brad Paterson, Intuit Vice President and Managing Director Asia-Pacific, says he doesn’t believe any new business would indeed opt for the desktop package over cloud.
“It’s being used still by older businesses, and they’re mostly looking to move to cloud as well,” he says.
Paterson believes that for businesses that are yet to make the switch, the reasons generally come down to a lack of awareness, and timing concerns.
“There can be an element of fear in heading to the cloud, and around data security, access to data, internet access and so on. But it can be a matter of education around making the switch,” he says.
In terms of converting to the cloud, Paterson adds the process is much simpler than some may think.
“It’s very easy – it’s a matter of exporting a data file from your desktop software – which usually take a couple of minutes – to an excel spreadsheet or a CSV file, and that’s it. The file then gets converted into the cloud, and it can take from 24 hours to 72 hours. Then it’s just a matter of the accountant or small business owner familiarising themselves with the new product. It’s a matter of understanding that that’s how easy it is.”
Similarly, Pete Sanders Managing Director – Business Group at Reckon, believes the future of small business accounting rests firmly in the cloud. However, unlike some of its competitors, Reckon is still committed to their desktop product and has just launched their latest 2014 package.
Sanders says the reason for this is that the desktop software is more functionally rich at the small businessprice point than any other software on the market.
“Cloud is obviously still fairly new, and the oldest competitor we have has been on the market for 9-10 years. The reality is though, that they haven’t built up all that functionality that’s been there for the past 20-25 years in the desktop products. So we’ve got SME customers saying to us that they still need all that functionality before they can move to the cloud – so that’s why they’re still using desktop,” Sanders says.
Sanders adds that some customers still hold security fears, and use desktop because they feel that safer using it ‘offline’.
However, in using the cloud, it’s important to note that the data is not stored on the device – it’s stored in data centres, and only a limited number of people know the locations.
Sanders points out that for Reckon’s cloud products, the information is behind several walls of security. “Security is paramount for us, because we know that a security breach would cripple our company,” Sanders says.
“Beyond your own passcode that you have in place on the phone or device in order to access it in the first instance, there’s also a pin in place in order to access the application, and you’ve got to key that in every time you log into the application. Beyond that, we also have the full suite of Amazon security in place,” he adds.
Notably, research commissioned by Intuit recently found that in future, some 88 per cent of business owners believe it will be essential to complete business-related tasks on mobile devices.
Business tasks with the biggest expected increase in uptake were:
  • Accepting payments – from 13 per cent today to 31 per cent;
  • Invoicing – from 12 per cent today to 26 per cent;
  • Web/videoconferencing – from 15 per cent today to 30 per cent.

3 thoughts on “Why would anyone opt for desktop accounting over cloud?

  1. Nathan Elcoate February 24, 2014 at 12:49 pm
    That’s an interesting and informative article, but I believe there are still many advantages in a business choosing Desktop over Cloud.
    As Pete mentions, the Desktop offerings are often more feature rich than the Cloud offerings, are more cost effective for small business, and there are those organisations where they would really have to go to Private Cloud to host several applications that are all tied into the Desktop system at present.
    This is where Reckon have a distinct advantage over their Competitors with a three pronged Desktop, Hosted and Cloud offering – something for everyone!
    Reply 
  2. Craig February 24, 2014 at 1:09 pm
    Desktop system often have more functionality than cloud counterparts. It is the same in my industry, Salon Software. This is really just a factor of time though, cloud software is often only 2 or 3 years old and desktop software 10-15 years.
    Reply 
  3. Sonia February 24, 2014 at 10:02 pm
    A business might choose desktop accounting software because their needs are different and Cloud isn’t the best fit. I’m a big fan of Cloud solutions but I hate a cookie-cutter approach. Businesses need to look at their own needs and find a solution that fits, instead of just relying on Cloud hype.
    One customer has integration between their bookkeeping software and other on-premise systems. It’s not cost-effective for them to replicate this in the Cloud because of the cost of third-party add-ons to make the integration work. They are low volume, so speed efficiences don’t count for much and have no need for offsite access.
    Another customer has bookkeeping & inventory add-on in the Cloud, with staff in two locations, a bookkeeper in a different location and owners who regularly travel. Cloud is a no-brainer for them.
    Different strokes for different folks. Just make sure your decision is based on actual business benefit to suit your circumstances.

Posted on 7:05 AM | Categories:

FreeAgent launches new division to support UK accountants

FreeAgent, the UK market leader in online accounting, has today launched its first dedicated division giving direct support to UK accountants and their clients. 

The company has invested in an initial 12-strong team that will spearhead its work in the accounting sector and liaise closely with accountants to introduce and familiarise them with its award-winning online accounting system.

The new division follows the recent launch of the company’s “FreeAgent Friendly” programme, giving UK practices access to FreeAgent’s range of innovative accountant-focussed features and official accreditation process, as well as extending the company’s world-class support channels to accountants.

Among the dozen staff comprising the new division, FreeAgent has recruited former ICAEW business development manager Andrew Garvey, who will spearhead the company’s work with accountants in Wales and the South West. 

Ed Molyneux, CEO and co-founder of FreeAgent, said: “FreeAgent is the most popular cloud accounting software with small business owners in the UK, and presents a great opportunity for accountants to build and strengthen their practices. 

“We’re thrilled to launch our first dedicated division for the accountancy profession, which will provide accountants with practice and client training, marketing assistance, formal accreditation and exposure to our rapidly-growing base of micro-businesses.

“We’ve already put together a strong team with a lot of experience within the accountancy profession to lead our FreeAgent Friendly efforts, and we believe this expertise will be invaluable as we drive forward our work with practices across the country. As we step up our endeavours in this sector over the coming years, we expect to grow our division even further so that we continue to provide the best service possible to UK accountants. 

“We’re looking forward to working closely with practices throughout the country to introduce them to FreeAgent and demonstrate how we can help them work more effectively with their small business clients.”

FreeAgent offers accountants simple pay-as-you go monthly billing, including free automated Bank Feeds and fully integrated RTI-compliant Payroll. Additionally the FreeAgent Practice Dashboard gives practices an immediate overview of their clients, allows them to manage user-level access permissions and enables a proactive approach through exception-based Alerts custom defined at an Account Manager level.

FreeAgent also offers full product training and a free accreditation programme enabling practices to become officially “FreeAgent Friendly” - an additional mark of credibility and expertise they can promote to their customers. Accredited practices will also be added to the FreeAgent Friendly directory - putting them in front of over 35,000 freelancers, and micro businesses, many of whom are actively looking for an accountant - and will receive exclusive content to help them grow their practices. 

Accountants interested in learning more about the FreeAgent Friendly programme should contact FreeAgent on 0800 025 3900 or visit www.freeagent.com/accountants

About FreeAgent:

FreeAgent provides the UK’s market-leading online accounting system designed to meet the needs of small businesses, freelancers and their accountants. More than 35,000 customers currently use the award-winning system to manage and maintain their business accounts, track time, log their expenses, create and send invoices and forecast their tax bills.

FreeAgent was recently placed 8th in the 2013 Deloitte Fast 50 - the annual list compiled by Deloitte that highlights the fastest-growing technology companies in the UK - and was listed in the 2014 FinTech50 rundown of Europe’s most innovative financial technology companies. 

The company won the Small Business Accounts and Expense Management awards at the 2013 AccountingWEB Software Satisfaction Awards and is a previous winner at the British Accountancy Awards. FreeAgent is also an official 2014 ICAS partner.

Find out more at: www.freeagent.com/accountants
Posted on 7:05 AM | Categories:

Licence Poaching Forces Xero To Overhaul Partner Program

Sholto MacPherson for BoxFreeIT writes: Xero’s partner program will be overhauled to address bookkeepers’ complaints of licence poaching by accountants, Chris Ridd, Xero managing director for Australia, announced last Wednesday.
Xero partners who achieved gold status or higher received a larger margin from the monthly Xero subscription and were positioned at the front of Xero’s online partner directory which received high numbers of sales inquiries. The current program encouraged partners to accumulate more licences so they ranked higher in the directory than others in the same bracket.
“It’s been an interesting year managing partners with predatory behaviour,” Ridd told BoxFreeIT.
The new program, likely to launch in August, would reduce the emphasis on the number of registered clients and focus on on-going training and certification, attendance at Xero events and other factors.
Speaking at Xero’s Sydney roadshow last week, Ridd said Xero management had been surprised when a bookkeeper at last year’s annual conference recounted how an accountant had asked mutual clients to make him the registered partner on their Xero accounts.
“It was an awkward moment. The bookkeeper was pretty much in tears, and she put up her hand and said ‘I had an accountant steal my clients and I’ve dropped back to bronze’,” Ridd told the audience.
Xero’s CEO Rod Drury was “pretty upset” by the incident, Ridd told BoxFreeIT later. “Rod said, ‘We just got smashed on stage’.”
The existing program also lacked incentives for partners on silver or gold to develop their relationship with Xero, Ridd said.
“Every now and then a partner gets to a certain level and they might have staff leave and they don’t recertify or they stop coming to events and that’s a problem for us,” Ridd said. “You could be gold (status) and own 120 organisations and be on the top of the directory and do nothing else. That’s not fair for a bookkeeper who is doing a whole lot more.”
Xero was designing a rewards program similar to a frequent flyer loyalty scheme with the focus on constant engagement rather than hitting sales targets, Ridd said.
The new points based system would reward commitment to Xero. If a client or another adviser invited a partner into a Xero account they would receive points. “It suggests you’re good at what you do,” Ridd said.
Partners would also receive points for the number staff certified on Xero and for attending events.
“The important message is that size is not everything. If I never want to manage 25 clients, but I’m committed and I’m on the journey, then I want a reward for that. Hopefully that can still get you silver” status, Ridd said.
Accountants and bookkeepers that were passionate and engaged with Xero were likelier to have happier clients who would stay with the Xero accounting platform. “If their clients are happier, they stick. That’s a better partner,” Ridd said. “It’s all about loyalty and stickiness, driving down our churn buy having more committed partners.”


Sholto Macpherson is a business technology journalist specialising in cloud software. He lives and works in Sydney, Australia,you can read him @ BoxFree IT here.


Posted on 7:05 AM | Categories:

You Can't Take These 5 Capital Losses in 2014

The Motley Fool/NASDAQ writes: When you sell assets that have gone down in value, at least there's one bright spot: You can take a tax deduction on your loss.

Or can you?
Some capital losses may only be partially deductible, or you may not be able to take a deduction until a later year. In fact, some capital losses are not deductible at all.
So before you count on a capital loss for a deduction, check out the rules for these five capital losses in 2014.
Capital losses that exceed capital gains by more than $3,000 You generally cannot take a net capital loss for more than $3,000 in any tax year. For example, say you have a $13,000 capital loss from a stock you sell in 2014. You expect to reduce your taxable income by $13,000. Not so fast. You can only use up to $3,000 in capital losses to reduce most taxable income.
If you have capital gains in 2014, you can offset them with capital losses. That's why it's smart to look around for assets you may want to sell at a gain when you sell another asset at a loss, and vice versa. Remember to always make good investment decisions first and tax-planning decisions second.
If you cannot take all your capital-loss deductions in one year, you can carry them forward to the following year.
Capital losses from rental real estate if your income is too high Owning rental real estate has been a favored method for deferring taxes for decades. Thanks largely to the depreciation deduction, you might be able to take tax losses every year, while your property (hopefully) went up in value. The rental-losses allowance is limited to an allowance of $25,000 per year, or $12,500 if you are married filing separately and have lived apart from your spouse all year.
To qualify for this allowance, you must actively participate in the management of your rental property. You also may be subject to "at-risk" rules if not all of your investment is at risk.
Taking a loss on rental real estate is not so easy anymore, especially if you have significant other sources of income. If your modified adjusted gross income, or MAGI, is between $100,000 and $150,000, the maximum amount you can deduct is phased out. If it's over $150,000, you're out of luck. If you're married filing separately, the allowance phases out between $50,000 and $75,000.
You can carry forward any loss not allowed under these rules to the following years.
Losses on personal property Is your house worth less than you paid for it? Losing money on your home can be a big financial hit, but the IRS doesn't care. You cannot take a loss on your home, furniture, personal car, or other personal belongings.
The flip side is that when you buy another house that goes up in value, you probably won't have to pay tax on the gain. So that's a plus.
Capital losses for which your investment is not all at risk The IRS considers something to be "at risk" if you can lose all of your investment in it. If that's the case, you don't have to worry about at-risk rules.
Otherwise, if you're not fully at risk, you cannot deduct a loss for more than the amount you have at risk.
Capital losses on securities you replace within 30 days You have a stock that's down, but you still have faith in it. You sell it at a loss, but when it starts to show signs of life, you buy it back.
If you were in too much of a hurry, you may have just lost your tax-deductible loss for the year. If you sell stock or securities and buy substantially identical stock or securities within 30 days before or after the sale, you just made a "wash sale." The loss won't reduce your income this year. It will reduce your basis in the replacement stock when you eventually sell it, however.
Know the rules before you sell Make sure you know the tax ramifications of a sale before you commit to selling an asset. When you understand how a gain or loss affects your total tax situation, you can plan your tax year accordingly, so stay abreast of the rules regarding capital losses in 2014.
Posted on 7:05 AM | Categories:

Xero to Automate Conversions from MYOB and QuickBooks

Sholto MacPherson for BoxFree IT writes: Xero was testing an automated conversion service to convert data files from MYOB and QuickBooks when setting up a new Xero account, the company revealed at last week’s roadshows in Australia.
The Xero accountants and partners would upload the file in the “Green” Xero Adviser screen and receive a notification when the converted Xero file was ready, according to screenshots of the service shown at Xero’s roadshow in Sydney last Wednesday.
The conversion service would address one of the two main impediments to switching businesses from rival programs.
“Over 90 percent of people are saying we need help with this. That excites and concerns us because there is massive demand. But we’re determined to capitalise on the opportunity,” Chris Ridd, managing director for Xero Australia, told BoxFreeIT.
Two impediments stopped businesses from switching accounting platforms. The first was that business owners didn’t have time to learn a new product. Xero hoped to address this with its training webinars and online video library. The second issue was moving data from the incumbent program to Xero.
The first phase of the project, to create an automated tool to help partners do conversions, had already been completed, Ridd said.
While earlier conversion services had relied on outsourced accountants in India to convert files within three business days, Xero partner Jet Convert had built an automated tool that could scale up to meet demand. Xero had carried out technical due diligence into the Jet Convert software and was in commercial discussions to provide funding and boost capacity.
Jet Convert had processed several thousand conversions of which 70 percent were completed within a day, Xero claimed.
Xero planned to integrate the conversion service into the sign-up process under the second phase. A screenshot at the roadshow displayed a list of shared Xero files in the Xero Adviser screen with a progress bar under converting files.
Conversions would be handled invisibly by Jet Convert and other conversion services.
Partners preferred to trust their clients’ files to Xero and wanted one throat to choke, Ridd said.  “The experience is I load the data file through My Green Xero and several days later all the balances are set up including payroll,” Ridd said.
Xero planned to launch the second phase by the middle of the year. It would be trialled first in the US where Xero was anxious to remove any barriers in its fight against Intuit.
“Our strategy for the US is to knock down any barriers to switch. Intuit is very strong and we’re a challenger,” Ridd said.
You can Read Sholto MacPherson here.
Posted on 7:04 AM | Categories:

Here's Some Good Tax News in 2014

  for The Motley Fool writes: You've no doubt heard about new penalties and higher taxes, and possibly the expiration of some of your favorite tax benefits. You could probably use some good news by now -- and we've found it. Check out these good news for taxpayers preparing their 2013 returns or planning for the 2014 tax year:
Simplified home office deduction rules
The IRS is making something easier? You heard that right. Not only do the new rules make it easier to take a home office deduction now, but they promise to keep things simpler when you sell your home in a later year.
You basically take a standard deduction of $5 per square foot of your home that you use for business, up to a maximum of 300 square feet. You can still take your full mortgage interest and property tax deductions on Schedule A -- no more allocating between business and personal use. And when you sell your home some years from now, you don't have to recapture depreciation on your home for the years you took the simplified option.
The simplified option is effective for your 2013 tax return, filed in 2014.
Inflation adjustments
If you take the standard deduction, the amount gets a little more generous each year. For 2013, it rises to $6,100 ($12,200 for married couples filing jointly). For 2014, the standard deduction is $6,200 ($12,400 for married couples filing jointly).
The personal exemption for 2013 is $3,900, rising to $3,950 for the 2014 tax year.
If you earn money overseas, your foreign earn income exclusion is $97,600 in 2013, and $99,200 in 2014.
If you benefit from the Earned Income Credit, and you have three or more children, the maximum amount of your credit is now $6,044 for 2013 and $6,143 for the 2014 tax year.
Other tax breaks and limitations have been adjusted similarly for inflation.
Estate taxes
The estates of taxpayers who died in 2013 have a basic exclusion of $5,250,000. For 2014, that's $5,340,000.
That's a good deal, especially compared to recent exclusion amounts. In 2008, for example, the basic exclusion amount was only $2,000,000.
Residential Energy Efficient Property Credit
Thanks to an extension through 2016, you can still get an energy efficiency tax credit for the cost of alternative energy equipment for your home.
The credit is 30% of the cost of solar hot water heaters, solar electric equipment, and wind turbines that you have installed during the year.
If you have a second home or a vacation home, take note. For this credit, the home does not have to be your main home.
Tax credits for buying health insurance
Starting in 2014, you may qualify for a tax credit to help you pay medical insurance premiums. This credit is paid directly to your health insurance company.
True, you must buy insurance through the government's Affordable Insurance Exchange to get this credit, and if you discover later that you didn't qualify for the credit, you have to pay it back. If you can't afford insurance otherwise, however, these new credits may help.
Health care FSA new $500 carryover deal
If your employer offers a Flexible Spending Arrangement, or FSA, for your benefits, you're probably aware of the use-it-or-lose-it rule for medical reimbursements. It's the reason so many people are buying new glasses in December and otherwise rushing to spend FSA money before it disappears.
Starting with the 2013 tax year, employers have the choice of giving you three months after the end of the year to use your FSA amounts for the previous year, or letting you carry forward up to $500 to the following year. Your employer must offer one option or the other -- not both.
In addition, Congress may offer more perks or extend some old ones for 2014 before the end of the year. As long as politicians want to win points with the public, we can always hope for more good news on the tax front.
Posted on 7:04 AM | Categories:

Maxing 401k, Roth IRA, HSA...What Next?

Over at Bogleheads we came across the following discussion:   Maxing 401k, Roth IRA, HSA...What Next?by lyner » Sat Feb 22, 2014 7:32 pm
Age: 20s
Gross Income: Low 80k range
Federal Tax: 25%
State Tax: 4%


Retirement Accounts
Roth IRA: $28,000
401k: $98,000


Other Savings - Emergency Fund, House Down Payment, Car Fund, etc.
Checking (0.01%): $5,000
Online Savings (0.9%): $30,000


Debt
None


Right now, I am maxing out my 401k ($17,500), Roth IRA ($5,500), and HSA ($3,300) for 2014. Cruise control is set, and I just plan on dumping whatever money that is left over each month into my Online Savings Account. Do you folks have suggestions for what else I can be doing with the left over money (~1,000+) that may benefit in the long run? I do not have a taxable investing account.


Presently, I have no definitive timeline on my first house purchase, and I think I am still a few years out until I call it quits with my current car. Consequently, I do not forecast any major purchases on the horizon.


Overall, I'm just looking for other investment vehicles I should consider and research considering my situation. Thanks in advance!

Re: Maxing 401k, Roth IRA, HSA...What Next?by retiredjg » Sat Feb 22, 2014 7:50 pm

There are not a lot of options.


1) You can start saving in your taxable account for a certain goal - car, house, whatever. You can do better than just a savings account, but this might be money you don't want to invest at the same stock to bond ratio as your retirement investments.


2) You can start saving in your taxable account for retirement - you would fold this money into your already decided retirement asset allocation and use tax-efficient stock index funds in your taxable account. (Yes, there is a little BH revolution going on about what goes in taxable.)


3) You could start a 529 plan for children you might have or your own future education. I would not go that route, but some might.


4) You can check to see if your employer allows employees to make after-tax contribution (aka "employee contributions") to your 401k. This is not the same thing as Roth 401k, it is something different. If you can do this and if they let you roll the money out on a regular basis, you could get a lot of money into Roth IRA each year.


5) Go to Europe or Africa for a month....?
Posts: 16022
Joined: 10 Jan 2008

Re: Maxing 401k, Roth IRA, HSA...What Next?by scamper » Sun Feb 23, 2014 11:05 am

I faced the same dilemma a few years ago. Here's my tax-advantaged retirement savings plan.


1) Social Security - no choice but to pay for it.
2) Company's pension - no choice, automatic.
3) Company 401k - contribute maximum before tax.
4) Backdoor Roth IRA for spouse & I. After tax contributions, but no tax on earnings in retirement.
5) HSA - Before tax contributions. Saving receipts to withdraw funds tax free in retirement; then withdraw with taxes like the 401k.
6) 529 plan - no longer contributing as our child is now in college with full funding - receives OK income tax deduction (no Federal deduction), no taxes on earnings.
7) Donor Advised Fund - saving before tax funds annually to donate to charity when in retirement. Allows the avoided taxes to accumulate tax free.
8) I-bonds - purchasing with aftertax funds, but no taxes due on earnings until withdrawal. This is our emergency funds also.
9) Bite the bullet, pay the taxes and invest in regular brokerage account.


The first 4 methods allow full freedom of use in retirement; the I-bonds can be used anytime; the HSA, 529, and DAF have use restrictions.
Posts: 2
Joined: 21 Feb 2014

Re: Maxing 401k, Roth IRA, HSA...What Next?by retiredjg » Sun Feb 23, 2014 11:27 am

scamper wrote:5) HSA - Before tax contributions. Saving receipts to withdraw funds tax free in retirement; then withdraw with taxes like the 401k.


You can save receipts from now and withdraw many years later based on those receipts?
Posts: 16022
Joined: 10 Jan 2008

Re: Maxing 401k, Roth IRA, HSA...What Next?by ajcp » Sun Feb 23, 2014 11:41 am

retiredjg wrote:
scamper wrote:5) HSA - Before tax contributions. Saving receipts to withdraw funds tax free in retirement; then withdraw with taxes like the 401k.


You can save receipts from now and withdraw many years later based on those receipts?



Yes. Some people prefer to deal with the recordkeeping and save receipts, others figure their medical expenses in retirement will be enough to use the HSA anyway and it's not worth the hassle.
Posts: 331
Joined: 13 Dec 2013

Re: Maxing 401k, Roth IRA, HSA...What Next?by cherijoh » Sun Feb 23, 2014 12:11 pm

Are you saving an excess of $1000/month in your savings account? Wow!


Allocate at least 6 months of expenses in your savings account as an emergency fund. Then make a SWAG on various short term goals. For example, save $25K to buy a new car in 3 years. I'm sure some Bogleheads would recommend a lesser amount to buy a used car.  


For these short-term goals:
-You could look at i-bonds as mentioned above. You have to hold for 12 months and there is a maximum $10K/year. No state taxes and you can opt to wait and pay taxes when they are redeemed. http://www.treasurydirect.gov/indiv/research/indepth/ibonds/res_ibonds.htm
- You could look into higher yield CDs. The increased interest vs. your savings account would likely exceed any penalties for breaking the CD early provided you don't immediately turn around and cash them out. But I would look at trying to match the CD period to the estimated time frame for your goal. Or if you want to hedge against rising rates, you could get some staggered durations.
- I'm not sure you are in a high enough tax bracket to make a tax-exempt bond fund a good option


But you still might want to use a portion of this excess savings towards a tax-efficient stock index fund. Just keep in mind that you run the risk of a downturn in the market when you want to redeem the funds.
Posted on 7:03 AM | Categories: