We are in the process of disbanding our club and
distributing assets. Don't feel bad, we did this for 15
years and everyone is on board with this.
I read the Bivio page on disbanding a club and that was
helpful, but other posts here mentioned about possible
complications with transferring shares rather than
liquidating all holdings then distributing the proceeds. We
have about five members who would like to have shares
transferred to them and we've set up a process to get their
preferences on which security they would prefer getting, so
I don't think that there will be any fights over which
stocks to transfer. The remaining members would prefer the
cash and are okay with the capital gains. Any warnings on
the transferring of securities process when disbanding a
club? Thanks.
Laurie Frederiksen on
We are sorry to hear your club is disbanding. Here are some things to consider when you are transferring shares:
1. Only transfer shares that have gone up in value. It is in everyones best interest to sell the losers instead of transferring them.
2. If you own multiple lots of a stock, make sure to identify the same lots the broker transfers to a particular member when you fill in the withdrawal form.
3. Make sure the cost basis of all your shares of all of your stocks is correct in bivio before you proceed with disbanding entries.
4. Value all of your assets on the same date when determining how much each person is owed. This includes establishing the number of shares that each person will receive. If you value stocks on a different day, you may end up owing someone more or less than you have left.
5. Transfer stocks quickly once you have determined a valuation date. You do not want to get into a situation where the club receives a dividend that really should belong to the new owner of the stock.
Laurie Frederiksen Invest with your friends! www.bivio.com
We are in the process of disbanding our club and
distributing assets. Don't feel bad, we did this for 15
years and everyone is on board with this.
I read the Bivio page on disbanding a club and that was
helpful, but other posts here mentioned about possible
complications with transferring shares rather than
liquidating all holdings then distributing the proceeds. We
have about five members who would like to have shares
transferred to them and we've set up a process to get their
preferences on which security they would prefer getting, so
I don't think that there will be any fights over which
stocks to transfer. The remaining members would prefer the
cash and are okay with the capital gains. Any warnings on
the transferring of securities process when disbanding a
club? Thanks.