Club Expenses/Hardware/Subscription Purchase for Club Questions - Long
Irina Clements on
All: Interested to hear your feedback/experience with
all/some of the following.
Our club is considering purchasing a laptop, projector (and
briefcase for both), for about $950 and using club funds to
do so. We have contemplated a "special assessment" of about
$100 per member or, using funds from our monthly cash
contributions and purchasing the equipment instead of stock,
and thus it would be an expense to club. We will straight
line depreciate equipment over five years and plan to
"technology refresh" about every five years.
In parallel, we are considering purchasing a wifi capability
also to be paid monthly via club deduction/expense rather
than reimbursement to a particular member.
Not hardware, but we are considering purchasing Manifest
Investing Subscription for all club members and also
expensing to club.
Our club once had an additional $3 monthly fee per member
for admin expenses, but removed it for a number of reasons.
1) Members appear to believe there is an advantage to having
these expenses allocated on the individual partnership K-1s
instead of purchased by each member [I do not agree, because
I believe that either way, the investment expense must carry
to each individual partner's 1040 Schedule A itemized
deductions 2% investment expenses "floor".] Comments
welcome.
2) The rationale for having an "all in one Club technology
kit" composed of projector and laptop, is that variously
connecting various members' various Apple or PC hardware,
and the resulting cables, and projector screen display
issues grew tiresome. And also, we were not dependent on
one member's laptop/projector.
3) Having the Club purchase the subscriptions is "cleaner"
and synchronizes subscription dates, while not relying on
individuals to remember to subscribe or other issues caused
by the human element.
4) We also intend to provide for a "technology refresh"
fund. One member suggested that I keep a spreadsheet to
ensure I track the funds. My response was that they would
need to get a new treasurer. How can I track depreciation
or "technology refresh fund" in bivio if that is possible or
desired?
5) At present, our club has a $75 admin fee to join [in
addition to $50 initial contribution] necessary for new
members [We also require BI membership, and purchase of TK6
or use of the BI Online SSG (a computer/internet access is
assumed)]. We are a one person one vote club [as opposed to
ownership percentage]. I have tried to persuade our members
to do away with the entry fee as regressive, but folks want
to keep it a) because they all paid it, and b) it provides
funds to keep the expense investment of new members roughly
equal with current members. [I am only the messenger, I know
not logical].
I would very much appreciate the input of the bivio
community on the multiple issues addressed here, taxes,
accounting, admin fees, taxes, itemized deductions, etc.
I thank you in advance,
Irina Clements
Treasurer, Streetbeaters Investment Club
PS In tax/fee questions above, I likely know the answers to
the above, but would very much like a coherent
rationale/other voices to provide to my partners.
Stuart Weissman on
Where do you meet?
My club rotates to a different members home each week and prior to the meeting each member who has an SSG to present uploads the .ITK file to the club's files area in Bivio. We simply use an HDMI cable to attach to the laptop containing the club's portfolio in Toolkit and we are off to the races. I think I purchased the heavy duty 25-foot HDMI cable for $10 on Amazon. I really can't offer an opinion that differs from yours on the other topics.
Stuart Weissman
From: Irina Clements <irina39@verizon.net> To: club_cafe@bivio.com Sent: Thursday, November 13, 2014 10:57 AM Subject: [club_cafe] Club Expenses/Hardware/Subscription Purchase for Club Questions - Long
All: Interested to hear your feedback/experience with all/some of the following.
Our club is considering purchasing a laptop, projector (and briefcase for both), for about $950 and using club funds to do so. We have contemplated a "special assessment" of about $100 per member or, using funds from our monthly cash contributions and purchasing the equipment instead of stock, and thus it would be an expense to club. We will straight line depreciate equipment over five years and plan to "technology refresh" about every five years.
In parallel, we are considering purchasing a wifi capability also to be paid monthly via club deduction/expense rather than reimbursement to a particular member.
Not hardware, but we are considering purchasing Manifest Investing Subscription for all club members and also expensing to club.
Our club once had an additional $3 monthly fee per member for admin expenses, but removed it for a number of reasons.
1) Members appear to believe there is an advantage to having these expenses allocated on the individual partnership K-1s instead of purchased by each member [I do not agree, because I believe that either way, the investment expense must carry to each individual partner's 1040 Schedule A itemized deductions 2% investment expenses "floor".] Comments welcome. 2) The rationale for having an "all in one Club technology kit" composed of projector and laptop, is that variously connecting various members' various Apple or PC hardware, and the resulting cables, and projector screen display issues grew tiresome. And also, we were not dependent on one member's laptop/projector. 3) Having the Club purchase the subscriptions is "cleaner" and synchronizes subscription dates, while not relying on individuals to remember to subscribe or other issues caused by the human element. 4) We also intend to provide for a "technology refresh" fund. One member suggested that I keep a spreadsheet to ensure I track the funds. My response was that they would need to get a new treasurer. How can I track depreciation or "technology refresh fund" in bivio if that is possible or desired? 5) At present, our club has a $75 admin fee to join [in addition to $50 initial contribution] necessary for new members [We also require BI membership, and purchase of TK6 or use of the BI Online SSG (a computer/internet access is assumed)]. We are a one person one vote club [as opposed to ownership percentage]. I have tried to persuade our members to do away with the entry fee as regressive, but folks want to keep it a) because they all paid it, and b) it provides funds to keep the expense investment of new members roughly equal with current members. [I am only the messenger, I know not logical].
I would very much appreciate the input of the bivio community on the multiple issues addressed here, taxes, accounting, admin fees, taxes, itemized deductions, etc.
I thank you in advance,
Irina Clements Treasurer, Streetbeaters Investment Club
PS In tax/fee questions above, I likely know the answers to the above, but would very much like a coherent rationale/other voices to provide to my partners.
Stuart Weissman on
Whoops. Left out two important details. First we attach the other end of that HDMI cable to the members large screen color TV (which everyone seems to have today). Also, I said we meet weekly, but actually it's monthly. Sorry.
From: Stuart Weissman via bivio.com <user*15236200001@bivio.com> To: "club_cafe@bivio.com" <club_cafe@bivio.com> Sent: Thursday, November 13, 2014 11:12 AM Subject: Re: [club_cafe] Club Expenses/Hardware/Subscription Purchase for Club Questions - Long
Where do you meet?
My club rotates to a different members home each week and prior to the meeting each member who has an SSG to present uploads the .ITK file to the club's files area in Bivio. We simply use an HDMI cable to attach to the laptop containing the club's portfolio in Toolkit and we are off to the races. I think I purchased the heavy duty 25-foot HDMI cable for $10 on Amazon. I really can't offer an opinion that differs from yours on the other topics.
Stuart Weissman
From: Irina Clements <irina39@verizon.net> To: club_cafe@bivio.com Sent: Thursday, November 13, 2014 10:57 AM Subject: [club_cafe] Club Expenses/Hardware/Subscription Purchase for Club Questions - Long
All: Interested to hear your feedback/experience with all/some of the following.
Our club is considering purchasing a laptop, projector (and briefcase for both), for about $950 and using club funds to do so. We have contemplated a "special assessment" of about $100 per member or, using funds from our monthly cash contributions and purchasing the equipment instead of stock, and thus it would be an expense to club. We will straight line depreciate equipment over five years and plan to "technology refresh" about every five years.
In parallel, we are considering purchasing a wifi capability also to be paid monthly via club deduction/expense rather than reimbursement to a particular member.
Not hardware, but we are considering purchasing Manifest Investing Subscription for all club members and also expensing to club.
Our club once had an additional $3 monthly fee per member for admin expenses, but removed it for a number of reasons.
1) Members appear to believe there is an advantage to having these expenses allocated on the individual partnership K-1s instead of purchased by each member [I do not agree, because I believe that either way, the investment expense must carry to each individual partner's 1040 Schedule A itemized deductions 2% investment expenses "floor".] Comments welcome. 2) The rationale for having an "all in one Club technology kit" composed of projector and laptop, is that variously connecting various members' various Apple or PC hardware, and the resulting cables, and projector screen display issues grew tiresome. And also, we were not dependent on one member's laptop/projector. 3) Having the Club purchase the subscriptions is "cleaner" and synchronizes subscription dates, while not relying on individuals to remember to subscribe or other issues caused by the human element. 4) We also intend to provide for a "technology refresh" fund. One member suggested that I keep a spreadsheet to ensure I track the funds. My response was that they would need to get a new treasurer. How can I track depreciation or "technology refresh fund" in bivio if that is possible or desired? 5) At present, our club has a $75 admin fee to join [in addition to $50 initial contribution] necessary for new members [We also require BI membership, and purchase of TK6 or use of the BI Online SSG (a computer/internet access is assumed)]. We are a one person one vote club [as opposed to ownership percentage]. I have tried to persuade our members to do away with the entry fee as regressive, but folks want to keep it a) because they all paid it, and b) it provides funds to keep the expense investment of new members roughly equal with current members. [I am only the messenger, I know not logical].
I would very much appreciate the input of the bivio community on the multiple issues addressed here, taxes, accounting, admin fees, taxes, itemized deductions, etc.
I thank you in advance,
Irina Clements Treasurer, Streetbeaters Investment Club
PS In tax/fee questions above, I likely know the answers to the above, but would very much like a coherent rationale/other voices to provide to my partners.
John Rice on
As for #4. Just create an account called "Technology Refresh" or something similar. Each month, quarter or yearly transfer funds into it. We have an account called Expenses that I transfer $20 a month into and we use this money to pay for our annual subscriptions. No need for any other accounting of it. $75 seems excessive for something as easy as signing someone up. Depreciation is up to the company to decide. If your investment club only has a few thousand dollars in value than $1000 is material and should probably be depreciated but if your investment club is valued at
$100,000 or more than the technology expense is immaterial and does not need to be depreciated.
John Rice
ABODI Investment Club
On Thursday, November 13, 2014 7:57 AM, Irina Clements <irina39@verizon.net> wrote:
All: Interested to hear your feedback/experience with all/some of the following.
Our club is considering purchasing a laptop, projector (and briefcase for both), for about $950 and using club funds to do so. We have contemplated a "special assessment" of about $100 per member or, using funds from our monthly cash contributions and purchasing the equipment instead of stock, and thus it would be an expense to
club. We will straight line depreciate equipment over five years and plan to "technology refresh" about every five years.
In parallel, we are considering purchasing a wifi capability also to be paid monthly via club deduction/expense rather than reimbursement to a particular member.
Not hardware, but we are considering purchasing Manifest Investing Subscription for all club members and also expensing to club.
Our club once had an additional $3 monthly fee per member for admin expenses, but removed it for a number of reasons.
1) Members appear to believe there is an advantage to having these expenses allocated on the individual partnership K-1s instead of purchased by each member [I do not agree, because I believe that either way, the investment expense must carry to each individual partner's 1040 Schedule A itemized deductions 2% investment expenses "floor".]
Comments welcome. 2) The rationale for having an "all in one Club technology kit" composed of projector and laptop, is that variously connecting various members' various Apple or PC hardware, and the resulting cables, and projector screen display issues grew tiresome. And also, we were not dependent on one member's laptop/projector. 3) Having the Club purchase the subscriptions is "cleaner" and synchronizes subscription dates, while not relying on individuals to remember to subscribe or other issues caused by the human element. 4) We also intend to provide for a "technology refresh" fund. One member suggested that I keep a spreadsheet to ensure I track the funds. My response was that they would need to get a new treasurer. How can I track depreciation or "technology refresh fund" in bivio if that is possible or desired? 5) At present, our club has a $75 admin fee to join
[in addition to $50 initial contribution] necessary for new members [We also require BI membership, and purchase of TK6 or use of the BI Online SSG (a computer/internet access is assumed)]. We are a one person one vote club [as opposed to ownership percentage]. I have tried to persuade our members to do away with the entry fee as regressive, but folks want to keep it a) because they all paid it, and b) it provides funds to keep the expense investment of new members roughly equal with current members. [I am only the messenger, I know not logical].
I would very much appreciate the input of the bivio community on the multiple issues addressed here, taxes, accounting, admin fees, taxes, itemized deductions, etc.
I thank you in advance,
Irina Clements Treasurer, Streetbeaters Investment Club
PS In tax/fee questions above, I likely know the answers to the above, but would very
much like a coherent rationale/other voices to provide to my partners.
ira smilovitz on
I'm going to snip extensive portions of your original post...
On Thu, Nov 13, 2014 at 10:57 AM, Irina Clements <irina39@verizon.net> wrote:
All: Interested to hear your feedback/experience with
all/some of the following.
Our club is considering purchasing a laptop, projector (and
briefcase for both), for about $950 and using club funds to
do so. We have contemplated a "special assessment" of about
$100 per member or, using funds from our monthly cash
contributions and purchasing the equipment instead of stock,
and thus it would be an expense to club. We will straight
line depreciate equipment over five years and plan to
"technology refresh" about every five years.
While depreciation is the correct accounting approach, the individual items are small enough (in cost, not size) that I would just expense them when purchased. If you make a special assessment, it should still be recorded as a member payment and not a member fee. See below.
If you did decide to depreciate the equipment, you would track them as unlisted investments. Depreciation would be entered as a change in value each month. For example, a $600 computer depreciated straight-line over 5 years would drop in value $10/month. Tracking value monthly will be important for determining unit value and withdrawal values. The bigger problem would be accounting for the depreciation on the K-1 as bivio wouldn't do the calculation for you. You would have to manually determine how much depreciation to allocate to each member based on their relative ownership share each month and then manually enter it on Schedule K/K-1.
The various subscriptions/services are deductible club expenses. Whether you choose to allocate the expense proportionally (by units) or "by partnership exception" (equally) is a club decision. There isn't an absolute right or wrong way to do it.
Our club once had an additional $3 monthly fee per member
for admin expenses, but removed it for a number of reasons.
Removing it was a good move. Fees increase the unit value so the effect is to enhance the value of the members with the most units at the expense of the members with the fewest units. Any club that wants to collect money for administrative tasks should still record those funds as member payments so that the contributing member gets full value for their contribution.
1) Members appear to believe there is an advantage to having
these expenses allocated on the individual partnership K-1s
instead of purchased by each member [I do not agree, because
I believe that either way, the investment expense must carry
to each individual partner's 1040 Schedule A itemized
deductions 2% investment expenses "floor".] Comments
welcome.
You are correct. The "difference" is one of record keeping. If it's not on the K-1, the member has to remember to track it. If it's on the K-1, it's tracked for them.
We also intend to provide for a "technology refresh"
fund. One member suggested that I keep a spreadsheet to
ensure I track the funds. My response was that they would
need to get a new treasurer. How can I track depreciation
or "technology refresh fund" in bivio if that is possible or
desired?
I don't believe a refresh fund is necessary, but if you wanted to maintain one, you only need to set up a separate cash account in bivio, You could enter "contributions" to the fund as cash transfers from your regular cash account which would then show only the cash available for investment. When you audit/reconcile your club records you will have to remember to combine the bivio regular cash account and refresh fund to compare to your bank/broker statement.
5) At present, our club has a $75 admin fee to join
Yes, there is no real "need" for such a fee, but many clubs (my own included) still maintain them. If nothing else, it helps insure true interest in the part of the prospective member because they have a real cost if they decide to drop out quickly.
Ira Smilovitz
Mike Jones on
Each of my partners has his/her own laptop so we save by each using our own. Also, we can have our own SSGs available for discussion. Our best discussions occur when we each complete a separate SSG and then compare our reasoning. One member has a projector that we use at meetings and we expect that somewhere along the line we will need to buy a replacement bulb for it.
We enforce a $250 buy-in to keep browsers away but that amount buys shares in the club for the new member. We treat each other as partners and not as club members and it makes a lot of difference for us.
Mike Jones
Wall$treet Wannabees
Bloomington, MN
From: Stuart Weissman via bivio.com <user*15236200001@bivio.com> To: "club_cafe@bivio.com" <club_cafe@bivio.com> Sent: Thursday, November 13, 2014 10:16 AM Subject: Re: [club_cafe] Club Expenses/Hardware/Subscription Purchase for Club Questions - Long
Whoops. Left out two important details. First we attach the other end of that HDMI cable to the members large screen color TV (which everyone seems to have today). Also, I said we meet weekly, but actually it's monthly. Sorry.
From: Stuart Weissman via bivio.com <user*15236200001@bivio.com> To: "club_cafe@bivio.com" <club_cafe@bivio.com> Sent: Thursday, November 13, 2014 11:12 AM Subject: Re: [club_cafe] Club Expenses/Hardware/Subscription Purchase for Club Questions - Long
Where do you meet?
My club rotates to a different members
home each week and prior to the meeting each member who has an SSG to present uploads the .ITK file to the club's files area in Bivio. We simply use an HDMI cable to attach to the laptop containing the club's portfolio in Toolkit and we are off to the races. I think I purchased the heavy duty 25-foot HDMI cable for $10 on Amazon. I really can't offer an opinion that differs from yours on the other topics.
Stuart Weissman
From: Irina Clements <irina39@verizon.net> To: club_cafe@bivio.com Sent: Thursday, November 13, 2014 10:57 AM Subject: [club_cafe] Club Expenses/Hardware/Subscription Purchase for Club Questions - Long
All: Interested to hear your feedback/experience with all/some of the following.
Our club is considering purchasing a laptop, projector (and briefcase for both), for about $950 and using club funds to do so. We have contemplated a "special assessment" of about $100 per member or, using funds from our monthly cash contributions and purchasing the equipment instead of stock, and thus it would be an expense to club. We will straight line depreciate equipment over five years and plan to "technology refresh" about every
five years.
In parallel, we are considering purchasing a wifi capability also to be paid monthly via club deduction/expense rather than reimbursement to a particular member.
Not hardware, but we are considering purchasing Manifest Investing Subscription for all club members and also expensing to club.
Our club once had an additional $3 monthly fee per member for admin expenses, but removed it for a number of reasons.
1) Members appear to believe there is an advantage to having these expenses allocated on the individual partnership K-1s instead of purchased by each member [I do not agree, because I believe that either way, the investment expense must carry to each individual
partner's 1040 Schedule A itemized deductions 2% investment expenses "floor".] Comments welcome. 2) The rationale for having an "all in one Club technology kit" composed of projector and laptop, is that variously connecting various members' various Apple or PC hardware, and the resulting cables, and projector screen display issues grew tiresome. And also, we were not dependent on one member's laptop/projector. 3) Having the Club purchase the subscriptions is "cleaner" and synchronizes subscription dates, while not relying on individuals to remember to subscribe or other issues caused by the human element. 4) We also intend to provide for a "technology refresh" fund. One member suggested that I keep a spreadsheet
to ensure I track the funds. My response was that they would need to get a new treasurer. How can I track depreciation or "technology refresh fund" in bivio if that is possible or desired? 5) At present, our club has a $75 admin fee to join [in addition to $50 initial contribution] necessary for new members [We also require BI membership, and purchase of TK6 or use of the BI Online SSG (a computer/internet access is assumed)]. We are a one person one vote club [as opposed to ownership percentage]. I have tried to persuade our members to do away with the entry fee as regressive, but folks want to keep it a) because they all paid it, and b) it provides funds to keep the expense investment of new members roughly equal with current members. [I am only the messenger, I know not logical].
I would very much appreciate the input of the bivio community on the multiple issues addressed here, taxes, accounting, admin fees, taxes, itemized deductions, etc.
I thank you in advance,
Irina Clements Treasurer, Streetbeaters Investment Club
PS In tax/fee questions above, I likely know the answers to the above, but would very much like a coherent rationale/other voices to provide to my partners.
Laurie Frederiksen on
Dear Irina,
You have several topics here to discuss. I'd recommend you consider things this way:
1. Do you need all the hardware you've listed to share information at a club meeting? As John has mentioned, there are other ways to share that might be much cheaper for your club. Let's start a separate thread to discuss those.
2. Expenses - as you've noted, the idea of handling a $950 expense as you've described is probably a lot of effort for virtually no benefit. There would be a way to handle the depreciation, but it would require a lot of extra entries in your accounting. And, whether you expense the computer or depreciate it, it will probably not provide much of any benefit for your members because of the 2% threshold before investment expenses can be deducted on members personal taxes.
3. As has been described many times, you don't separate expenses from investments by the way you
make the entries for the contributions. You separate them by the way
you enter what the money is used for.
All member contributions should be entered as member payments no matter
whether the money will be used to pay expenses or used to purchase
investments. Fee entries should be used for situations where you are penalizing a member for something. Fees are money that is "thrown in the pot" and increases the value of each members account based on their percentage of ownership.
If you feel a new member should sweeten the pot for everyone, perhaps for the reasons others have mentioned, that is up to your club.
Laurie Frederiksen Invest with your friends! www.bivio.com