Delaware Serves as a Corporate Tax Haven

Big corporations, small-time businesses, rogues, scoundrels and worse have turned up at Delaware addresses in hopes of minimizing taxes, skirting regulations, plying friendly courts or, when needed, covering their tracks. It’s easy to set up shell companies here and use the banking system, no questions asked.

Since 1792, the state established its Court of Chancery to handle business affairs. By the early 20th century, the state was writing friendly corporate and tax laws to lure companies from New York, New Jersey and elsewhere. Most of the businesses incorporated here are legitimate and many are using all legal means to reduce their tax bills.

Delaware is a great place to reduce a tax bill. Delaware today regularly tops lists of domestic and foreign tax havens because it allows companies to lower their taxes in another state — for instance, the state in which they actually do business or have their headquarters — by shifting royalties and similar revenues to holding companies in Delaware, where they are not taxed. In tax circles, the arrangement is known as “the Delaware loophole.”

It doesn’t take a lot to incorporate a company in Delaware, tax experts say. Shell companies, those with no employees, no assets and, in fact, no real business to speak of, are remarkably easy to establish here, and it doesn’t always matter who you are or what business you are in.

Delaware serves as a domestic tax haven, much like the Cayman Islands serves as an offshore foreign tax haven, and offers a similar level of tax avoidance. American corporations find the Caymans alluring for many reasons. There, they can operate in relative secrecy, attract more foreign customers, avoid regulation and enjoy a low tax rate. In one respect, however, Delaware is even better than the Caymans. At some point, American companies have to bring back their foreign profits from the Caymans and pay federal taxes.  But in Delaware, the state tax savings through the Delaware loophole are permanent.

Source: pettir.com – “Delaware Serves as a Corporate Tax Haven”

Mac Users Spend More on Travel

Orbitz told the Wall Street Journal that Mac users spend as much as 30
percent more on hotels than PC users do. Mac users were 40 percent
more likely to book a four- or five-star hotel than PC users. When
they do book the same hotel as PC users, they were more likely to stay
in a more expensive room.

IPhone and iPad users spend 17 percent more on mobile purchases than
everyone else, according to Forrester Research. And given that a Mac
is about three times more expensive than its Windows counterpart, it's
not surprising that an online retailer would want to try to figure out
what those customers like and offer them those options first.

QuickBooks POS is Integrated with GoPayment

Intuit has integrated its mobile payment processing application GoPayment with the latest version (2003) of QuickBooks Point of Sale (QuickBooks POS) software. The two solutions will now be able to communicate with each other, syncing both inventory and financial data from PC to mobile or vice versa.

QuickBooks POS software is designed for small retailers as tracking and management tools they need to effectively run their business. Retailers can track inventory and set automatic re-order points, manage customer's contact information and send personalized emails and gift cards, access business reports to get unique insight into how the business is doing, track employees' hours and pay commissions, and manage and monitor business results for up to 20 stores from one location.

A free GoPayment app comes with a card reader which plugs into the audio jack of an iPhone, iPad and iPod Touch as well as popular Android devices. Users can then swipe a card to process a payment, send an email or text receipt with a map of where the transaction took place, and automatically charge the correct sales tax using geolocation. Read full article “QuickBooks POS is Integrated with GoPayment” at accounting.pettir.com

Consumer sentiment rose in April

The final reading for consumer sentiment in April rose to 76.4 from
76.2 in March, according to reports on a gauge released Friday by the
University of Michigan/Thomson Reuters.

High gas prices and stock-market volatility have been weighing on consumers.

The sentiment gauge, which covers how consumers view their personal
finances as well as business and buying conditions, averaged about 87
in the year before the most recent recession. Economists watch
sentiment data to get a feel for the direction of consumer spending.

U.S. Unemployment Fell to 8.2% in March

The U.S. unemployment rate in March fell to 8.2% from 8.3%, mainly
because more people dropped out of the labor force.

The economy , meanwhile, added 120,000 jobs in March, marking the
smallest increase in five months, the government reported Friday. The
number of jobs created last month fell well below expectations and
failed to break the 200,000 level for the first time since December.
Employment in March was hurt in part by a 34,000 decline in retail
jobs.

The average workweek fell 0.1 hour to 34.5, while average hourly
earnings rose 0.2% to $23.39.

Employment gains for January and February were little changed under
Labor Department revisions.

Four major banks failed Fed's stress tests

Four banks failed at least one of four criteria in the test:
Citigroup, Suntrust Banks, Ally Financial and the insurance giant
Metlife.

The Federal Reserve said 15 of the 19 largest U.S. banks would remain
healthy even in a crisis that saw the markets plummet and the
unemployment rate rise above 13 percent. The results of the stress
tests, which were released earlier than planned, show the scope of the
recovery of the nation's financial system since it nearly collapsed in
2008.

Fed considers new form of quantitative easing

The Federal Reserve is considering a new kind of bond-buying program
that would simultaneously try to limit inflation, according to a
report in the WSJ.

The Fed would print new money to buy long-term mortgage or Treasury
bonds but effectively tie up that money by borrowing it back for short
periods at low rates.

U.S. GDP growth revised up to 3% in fourth-quarter

The U.S. economy grew 3% in the fourth quarter, faster than original
reading, the government reported Wednesday Increase in commercial
construction and consumer spending couple with lower imports
contributed to the higher growth.

The increase was the fastest in a year and a half, according to
revised Commerce Department data. Economists projected GDP growth
would be revised down to 2.7% from an initial reading of 2.8%.

Real final sales in the U.S., which exclude imports and inventories,
rose 1.1% instead of 0.9% as originally reported. Inventories, a major
source of fourth-quarter growth, totaled $54.3 billion instead of $56
billion as initially reported.

Inflation as measured by the consumer PCE index rose 1.2% in the
fourth quarter, or by 1.3% on a "core" basis if food and energy are
excluded.

Real disposable income climbed 1.4% in the fourth quarter, compared
with an earlier reading of 0.8%. The personal savings rate was 4.5%,
up from an initial estimate of 3.7%.

Facebook: the biggest internet IPO

With $5 billion initial public offering, Facebook would make it the biggest U.S. Internet IPO in history, topping the debut of its arch-rival Google Inc.

Facebook filed late Wednesday its much-anticipated IPO filing, setting the stage for what's expected to be the biggest public trading debut for an Internet company since 2004 when Google went public in a $1.7 billion IPO.

The social networking giant Facebook's IPO would also mark a high point in the rapidly growing social networking market, underscored last year by the public trading debuts of such players as LinkedIn (the professional networking site) and (Zynga Inc.) the social gaming company.

The IPO of Facebook also would rank among the top 10 biggest overall in U.S. history of U.S.-based companies. That list is led by Visa Inc., whose 2008 IPO was worth $17.9 billion, followed by General Motors in 2010 at $15.8 billion, AT&T Wireless Group in 2000 at $10.6 billion and Kraft  in 2001 at $8.7 billion, according to S&P Capital IQ.

U.S. economy is healing

The U.S. economy grew at a modest 2.8 percent rate in the final three months of last year, the fastest since spring 2010 and was the third straight quarter that growth has accelerated.

 

Americans spent more on cars and trucks, and companies built up their stockpiles. But growth in the fourth quarter and all of 2011 was held back by the biggest annual government spending cuts in four decades.

 

The Commerce Department says the economy grew just 1.7 percent last year, roughly half of the growth in 2010 and the worst since the recession.

Fed is likely to leave interest rate near zero through 2014

The Federal Reserve said Wednesday that it was likely to leave short-term interest rates at near zero levels at least through late 2014. The Fed is pushing out its easy-monetary policy even further into the future than previously indicated.

An interest-rate forecast is a historic step for the Fed, the latest in a series of moves under Chairman Ben S. Bernanke to increase transparency and communications with the public.

Policymakers at the central bank acknowledged the recent improvements in the economy but said that they expected economic growth over coming quarters to be modest and the unemployment rate, currently 8.5%, to decline only gradually. The Fed committee repeated its concern that strains in global financial markets continue to pose significant downside risks to the economic outlook.

Since August, the Fed had said it was likely to keep the federal funds rate at near zero at least through mid-2013. The federal fund rate broadly influences rates on loans for businesses and consumers.

Google users has to agree to new privacy policy

Google announced Tuesday that it will require all of its users to agree to a new privacy policy that will integrate user data across 60 Google products including Gmail, YouTube and search. The policy will also encompass information, including location data, collected on mobile devices. Users will not be allowed to opt-out. It will take effect March 1.

According to Google privacy director Alma Whitten said that “if you're signed in, we may combine information you've provided from one service with information from other services. In short, we'll treat you as a single user across all our products, which will mean a simpler, more intuitive Google experience."