Just want to clarify one thing before i have to BEGIN DISTRIBUTED
TRANSACTION on production boxes. here is an example.

SET xact_abort ON
BEGIN DISTRIBUTED TRANSACTION

UPDATE Table on LocalServer

UPDATE Table on RemoteServer

COMMIT

Should I implement the error handling right after each updates? to make sure
both the transaction successfully works then COMMIT everything else ROLLBACK
every thing.

I can give you one example, I want to Withdraw the money from one account
which is on Database1 and I want to deposit the amount which is Datbase2. I
want to make sure if deposit the transaction succcessfully completed then it
will commit the transaction.

Please advice, how I can do with BEGIN DISTRIBUTED TRANSACTION

Thanks