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Failure To Pay Employment Taxes – Penalties
As an employer, you must pay employment taxes if you have employees. Fail to pay and the IRS will rain all over your parade. Penalties If you have employees, you absolutely must deduct and withhold various taxes from the paychecks of your...
How to Save Taxes with an S Corporation
How to Save Taxes with an S Corporation Ever wondered why so many small businesses--more than 3,000,000 at last count--operate as an S corporation? Simple. An S corporation saves business owners big taxes in three separate ways: ...
Identity Theft - Is your business at risk?
More and more business owners are purchasing document shredders then ever before. Why?... Identity theft for starters. A new law is going into effect in the summer of 2005 which states that if you employ anyone for any reason and have personal...
Protecting the Tax Advantage of Your Deferred Compensation
The American Jobs Creation Act of 2004 imposed strict new rules on non-qualified deferred compensation plans. Beginning in 2005, deferred compensation programs that are not in compliance with the new rules may be taxed as wages, slapped with a...
Tax Advantages In A Home Business
Every year, several thousand people develop an interest in "going into business." Many of these people have an idea, a product or a service they hope to promote into an in come producing business which they can operate from their own homes. ...
 
Outsourcing and Your Business

Outsourcing and Your Business

Outsourcing is an established way of doing business today, allowing companies to maximize their budgets and resources — and generate better products.

Also referred to as subcontracting, outsourcing simply means acquiring a product or service rather than producing it in-house. Outsourcing is suitable for just about any industry. In the administrative field, for instance, a variety of activities can easily be farmed out to a subcontractor, including word processing, data entry, transcribing, research, contact management and event planning.

Outsourcing is extremely common practice within human resource (HR) departments. In fact, two-thirds of HR departments outsource at least one activity, according to research by the Bureau of National Affairs, Inc. and the Society for Human Resource Management. The top five outsourced HR activities are employee assistance/counseling, flexible spending account administration, pre-retirement counseling, outplacement services and pension/retirement plan administration.

Weighing the Outsourcing Option
When deciding whether outsourcing is a viable option, a company should consider all of the issues involved. Should the projects be kept in-house because they’re critical and employees need to know how to do them themselves? Also, does the company have a sourcing plan, staff members to oversee contracts or a philosophy that supports the outsourcing initiative? If it does, outsourcing may be ideal for your business. The bottom line is every business is different and companies should carefully weigh the benefits of outsourcing.

Benefits of Outsourcing
Many companies that choose to outsource do so because they don’t have or can’t attract the people skills they need. Subcontracting gives them


access to a much greater pool of resources. It also enables companies to cut cost by 10 to 30 percent, depending on the industry. They can purchase services on an as-needed basis, instead of maintaining a full-time employee. This allows them to avoid paying employee-related expenses such as salaries, unemployment taxes, paid vacation and sick leave, insurance — which results in a lower overhead.

In another aspect, outsourcing can help a company focus on its core business, creating a competitive advantage within its industry. Subcontracting also affords the business the chance to get the best job possible from the people it hires. By using a third party supplier, a company has more room to be critical of the kind of services provided. If the work is done in-house, company ties may interfere with the final product.

Outsourcing also offers a wide variety of other benefits, including:
•Faster setup of the function or service
•Acquire innovative ideas
•Increase commitment and energy in non-core areas
•Improve credibility and image by associating with superior providers
•Greater flexibility and ability to define the requisite service more readily
•Less dependency upon internal resources
•Greater control of budget
•Greater ability to control delivery dates
•Increase flexibility to meet changing business conditions
•Purchase of industry best practice
•Generate cash by transferring assets to the provider
•Gain market access and business opportunities through the supplier’s network
•Turn fixed costs into variable costs


About the Author

Copyright 2004, Kate Smalley
Connecticut Secretary
Freelance Secretarial and Transcription Services
http://www.connecticutsecretary.com
kms@connecticutsecretary.com

 

Internal Revenue Service
The US government agency responsible for tax collection and tax law enforcement. Includes income tax forms, instructions, and agency publications.
www.irs.gov
 
Tax Information for Individuals
Access to useful information, booklets and other tools from the Internal Revenue Service.
www.irs.gov
 
Tax Center - Yahoo! Finance - Tax forms, tips and calculators.
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tax.yahoo.com
 
Taxes: Tax Planning, Tools and Advice - MSN Money
Microsoft's Tax Preparation site, in association with Tax Server.
moneycentral.msn.com
 
Tax - Wikipedia, the free encyclopedia
Governments use different kinds of taxes and vary the tax rates: ... Taxes are most often levied as a percentage, called the tax rate, of a certain value, ...
en.wikipedia.org
 
H&R Block | Taxes, Online Tax Preparation, Tax Software, Filing ...
Offers online and in-person tax preparation and tax software, mortgages, brokerage and financial services, consumer tips and tax planning information.
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TaxCut Online | H&R Block | Online Taxes, File Taxes Online ...
File your Taxes online with TaxCut Online. Learn how to file taxes online here.
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Taxes & Estates, Tax and Estate Planning Advice - Forbes.com
Personal Finance - Get tax and estate planning advice and information from Forbes.com.
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Essential Links to Taxes
TurboTax Premier For Federal Returns 2005 Win/Mac, TurboTax Total Tax Solution Deluxe 2005 with State Win/Mac, TurboTax Basic 2005 Win/Mac... ...
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Government > Taxes in the Yahoo! Directory
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Taxes - Tax News for Home and Business from CNNMoney
The latest in tax law updates, news, forms & advice from CNNMoney.com. Includes a refund savings calculator, and interactive tax lessons.
money.cnn.com
 
The Tax Foundation - Educating Taxpayers Since 1937
Devoted to educating taxpayers about tax policy and the total tax burden borne by Americans at all levels of government.
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Welcome to the Vermont Department of Taxes
Welcome to the Vermont Department of Taxes... ... Changes to Property Tax Adjustments in 2007 - updated 10/18. - Tax Expenditures Transition Report on ...
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Franchise Tax Board Homepage
The department that collects state personal income taxes and bank and corporation taxes for the State of California. Access to forms and tax information.
www.ftb.ca.gov
 
HM Revenue & Customs: Home Page
News and information on tax and national insurance, including downloadable leaflets and forms and the latest news on filing tax returns on-line.
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State and Local Tax
Piper Resources; State Tax Rates and Structure ...Federation of Tax Administrators; State Payroll Taxes Information ...Symmetry Software ...
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Tax news and advice from Bankrate.com
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Online Tax Advice - Tax Preparation Help - Income Tax Tips
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