One caution is that the 2 items that John mentioned should be covered in your Partnership Agreement, ByLaws or whatever your forming document(s) might be. Those are both items that can be handled differently that what John has stated, depending on what your organization has decided works for you.
1. Their equity will be different but Bivio handles it so there is no issue. Our members have a wide range of equity but it doesn't matter. Everyone has an equal vote.
2. Pick a monthly valuation date that way everyone receives the same valuation baseno matter when they make their deposit.
Our club is considering instituting members' direct depositing their investment funds into our Schwab brokerage account. We understand that each of our 11 members would have an identifying amount to deposit - e.g. $50.01, $50.02, etc. The questions that I need your input on are the following:
1. How are the identifying cents treated in terms of member equity?
2. What about differential timing of when members make their direct deposits? How does that get handled in member equity/taxes, etc?
Thank you for your input.
Kay Branz
Lakshmi Investors
Kay Branz on
Thanks so much Carol and John for your insights and guidance. It's invaluable!
One caution is that the 2 items that John mentioned should be covered in your Partnership Agreement, ByLaws or whatever your forming document(s) might be. Those are both items that can be handled differently that what John has stated, depending on what your organization has decided works for you.
1. Their equity will be different but Bivio handles it so there is no issue. Our members have a wide range of equity but it doesn't matter. Everyone has an equal vote.
2. Pick a monthly valuation date that way everyone receives the same valuation baseno matter when they make their deposit.
Our club is considering instituting members' direct depositing their investment funds into our Schwab brokerage account. We understand that each of our 11 members would have an identifying amount to deposit - e.g. $50.01, $50.02, etc. The questions that I need your input on are the following:
1. How are the identifying cents treated in terms of member equity?
2. What about differential timing of when members make their direct deposits? How does that get handled in member equity/taxes, etc?