In the grand scheme of things and given how large the financial industry is, there really aren’t that many firms out there that specialize in arbitrage services. When you really think about it it’s not hard to see why, given that arbitrage services are a very specific aspect of remaining compliant when it comes to reporting financial income. All that being said, even though there aren’t that many choices to choose from it’s still critical that your business or that you yourself find the best firm out there that you can.
Before going into what you should be looking for in such a firm (hint: it’s four things), it’s first important to cover exactly what these firms do. In the world of finance and investing there’s something that’s known as arbitrage. This is the practice of making money by taking the money made off of tax-advantaged bonds and investing that money back into the stock market or into higher-risk and higher-yielding (or more dangerous) securities and stocks. If you take money that you’ve earned because of tax advantages associated with bonds and turn it into more money by placing it into riskier investments, the profit made is called arbitrage. In general, this kind of investing is frowned upon by the federal government because it’s taking tax advantages and making riskier investments, so the federal tax code is very specific about how that money is taxed or what regulations regard it. Now that you know a little bit more about how arbitrage and compliance works, let’s look at what makes a great arbitrage rebate calculation firm.
1. Commitment to the Tax Code. First and foremost, what you need to know about the arbitrage compliance laws and regulations is that they’re changing all the time. Almost every year there are changes to the tax code relating to arbitrage. Therefore, you need to pick a firm that stays up to date on these changes and knows what’s going on. If your’re going to be compliant, this is a must.
2. Great Communication. It never hurts if the firm you choose is committed to communicating with you clearly about what’s going on. They’re going to need lots of information from you, so great communication is a plus.
3. Thorough. As you might have guessed, remaining compliant on arbitrage is a complicated process. Therefore, you need to pick a firm that’s very thorough throughout the entire process. They should be asking you for every financial document you have, every tax return, and any piece of information that could possibly relate to your arbitrage and arbitrage compliance.
4. Flawless. As was already mentioned, the laws surrounding arbitrage and arbitrage compliance are very specific and the government takes them very seriously. If there’s an error in your accounting then you’re going to have to pay for it with a large fee. Thus, you need to make sure that the firm you choose doesn’t make mistakes. For example, Arbitrage Compliance Specialists has been ad free since 1986. That’s the kind of flawlessness you should be looking for.