Making Payments to Active Members, not Withdrawals?
My club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
Liz,
My first reaction is once a year the older members, especially those with larger shares, take partial withdrawals.
That accomplishes several things. One it reduces their share of the overall portfolio, and, two, gives them some of their investment back to augment their incomes. Third, it keeps them involved in the club.
Linda
My club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
|
Liz,My first reaction is once a year the older members, especially those with larger shares, take partial withdrawals.That accomplishes several things. One it reduces their share of the overall portfolio, and, two, gives them some of their investment back to augment their incomes. Third, it keeps them involved in the club.LindaMy club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
1. It might help to ask the members who are going to be wanting cash for a tentative budget so you can plan better for the eventuality.
2. Use the withdrawals as an opportunity to harvest some tax losses by dumping underperforming stocks (you DO have some underperformers, don't you? If not, are you accepting new members?)
3. Our club avoids mutual funds but you could make an argument in this situation for a short term bond fund or etf to park some cash.
On Mon, Jun 22, 2020 at 2:27 PM Laurie Frederiksen <laurie@bivio.biz> wrote:
Hi Liz,
Why doesn't it seem "fair" for members with a larger percentage of ownership to stop contributing temporarily to help reduce their ownership percentage compared to other members?
If you are going to make partial withdrawal payouts to members, you'll need to accumulate the cash to do so either from not investing member payments and other income you receive or by selling shares of stocks in your portfolio.
Laurie Frederiksen
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Click here to Subscribe to the Club Cafe email list. Click here to UnsubscribeLiz,My first reaction is once a year the older members, especially those with larger shares, take partial withdrawals.That accomplishes several things. One it reduces their share of the overall portfolio, and, two, gives them some of their investment back to augment their incomes. Third, it keeps them involved in the club.LindaMy club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
I have reviewed the new Partnership Agreement at better investing and the language has changed to allow stock transfer to someone who requests a withdrawal, partial or whole. This would have the person making the withdrawal pay all of the Capital Gains, not shared among the club. The older agreements had language, payable by check, which means you sell stocks and everyone pays their percentage of the capital gain according to their club ownership.
Sent from my iPhone
On Jun 22, 2020, at 11:49 AM, Stuart Lange via bivio.com <user*25028600001@bivio.com> wrote:
1. It might help to ask the members who are going to be wanting cash for a tentative budget so you can plan better for the eventuality.2. Use the withdrawals as an opportunity to harvest some tax losses by dumping underperforming stocks (you DO have some underperformers, don't you? If not, are you accepting new members?)3. Our club avoids mutual funds but you could make an argument in this situation for a short term bond fund or etf to park some cash.On Mon, Jun 22, 2020 at 2:27 PM Laurie Frederiksen <laurie@bivio.biz> wrote:
Hi Liz,
Why doesn't it seem "fair" for members with a larger percentage of ownership to stop contributing temporarily to help reduce their ownership percentage compared to other members?
If you are going to make partial withdrawal payouts to members, you'll need to accumulate the cash to do so either from not investing member payments and other income you receive or by selling shares of stocks in your portfolio.
Laurie Frederiksen
Invest with your friends!
www.bivio.com
Become our Facebook friend! www.facebook.com/bivio
Follow us on twitter! www.twitter.com/bivio
Follow Us on Google+
Click here to Subscribe to the Club Cafe email list. Click here to UnsubscribeLiz,My first reaction is once a year the older members, especially those with larger shares, take partial withdrawals.That accomplishes several things. One it reduces their share of the overall portfolio, and, two, gives them some of their investment back to augment their incomes. Third, it keeps them involved in the club.LindaMy club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
We transfer stocks to our withdrawing members plus some cash. We choose stocks that have the approximate amount of capital gain as the withdrawing member. In this way the remaining members do not have to pay capital gains when stock is sold. It is very easy to transfer stocks from our portfolio to the withdrawing member who opens an account at our brokerage.
I have reviewed the new Partnership Agreement at better investing and the language has changed to allow stock transfer to someone who requests a withdrawal, partial or whole. This would have the person making the withdrawal pay all of the Capital Gains, not shared among the club. The older agreements had language, payable by check, which means you sell stocks and everyone pays their percentage of the capital gain according to their club ownership.Sent from my iPhoneOn Jun 22, 2020, at 11:49 AM, Stuart Lange via bivio.com <user*25028600001@bivio.com> wrote:1. It might help to ask the members who are going to be wanting cash for a tentative budget so you can plan better for the eventuality.2. Use the withdrawals as an opportunity to harvest some tax losses by dumping underperforming stocks (you DO have some underperformers, don't you? If not, are you accepting new members?)3. Our club avoids mutual funds but you could make an argument in this situation for a short term bond fund or etf to park some cash.On Mon, Jun 22, 2020 at 2:27 PM Laurie Frederiksen <laurie@bivio.biz> wrote:
Hi Liz,
Why doesn't it seem "fair" for members with a larger percentage of ownership to stop contributing temporarily to help reduce their ownership percentage compared to other members?
If you are going to make partial withdrawal payouts to members, you'll need to accumulate the cash to do so either from not investing member payments and other income you receive or by selling shares of stocks in your portfolio.
Laurie Frederiksen
Invest with your friends!
www.bivio.com
Become our Facebook friend! www.facebook.com/bivio
Follow us on twitter! www.twitter.com/bivio
Follow Us on Google+
Click here to Subscribe to the Club Cafe email list. Click here to UnsubscribeLiz,My first reaction is once a year the older members, especially those with larger shares, take partial withdrawals.That accomplishes several things. One it reduces their share of the overall portfolio, and, two, gives them some of their investment back to augment their incomes. Third, it keeps them involved in the club.LindaMy club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
The investment club as entity has a cost basis for the stocks.
The individual who receives the stock in a withdrawal gets the new cost basis as the individual (not the basis that the club entity had).
Best, Irina
On Jun 22, 2020, at 3:17 PM, Rebecca Reeves via bivio.com <user*34255900001@bivio.com> wrote:
We transfer stocks to our withdrawing members plus some cash. We choose stocks that have the approximate amount of capital gain as the withdrawing member. In this way the remaining members do not have to pay capital gains when stock is sold. It is very easy to transfer stocks from our portfolio to the withdrawing member who opens an account at our brokerage.I have reviewed the new Partnership Agreement at better investing and the language has changed to allow stock transfer to someone who requests a withdrawal, partial or whole. This would have the person making the withdrawal pay all of the Capital Gains, not shared among the club. The older agreements had language, payable by check, which means you sell stocks and everyone pays their percentage of the capital gain according to their club ownership.Sent from my iPhoneOn Jun 22, 2020, at 11:49 AM, Stuart Lange via bivio.com <user*25028600001@bivio.com> wrote:1. It might help to ask the members who are going to be wanting cash for a tentative budget so you can plan better for the eventuality.2. Use the withdrawals as an opportunity to harvest some tax losses by dumping underperforming stocks (you DO have some underperformers, don't you? If not, are you accepting new members?)3. Our club avoids mutual funds but you could make an argument in this situation for a short term bond fund or etf to park some cash.On Mon, Jun 22, 2020 at 2:27 PM Laurie Frederiksen <laurie@bivio.biz> wrote:
Hi Liz,
Why doesn't it seem "fair" for members with a larger percentage of ownership to stop contributing temporarily to help reduce their ownership percentage compared to other members?
If you are going to make partial withdrawal payouts to members, you'll need to accumulate the cash to do so either from not investing member payments and other income you receive or by selling shares of stocks in your portfolio.
Laurie Frederiksen
Invest with your friends!
www.bivio.com
Become our Facebook friend! www.facebook.com/bivio
Follow us on twitter! www.twitter.com/bivio
Follow Us on Google+
Click here to Subscribe to the Club Cafe email list. Click here to UnsubscribeLiz,My first reaction is once a year the older members, especially those with larger shares, take partial withdrawals.That accomplishes several things. One it reduces their share of the overall portfolio, and, two, gives them some of their investment back to augment their incomes. Third, it keeps them involved in the club.LindaMy club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
We have one member who is constantly pushing the top of our approved ownership threshold. She just stops making contributions until such time as she drops below. Also, she is not allowed to contribute more than the minimum amount when she does contribute. This helps us keep the percentages where we want them.
1. It might help to ask the members who are going to be wanting cash for a tentative budget so you can plan better for the eventuality.2. Use the withdrawals as an opportunity to harvest some tax losses by dumping underperforming stocks (you DO have some underperformers, don't you? If not, are you accepting new members?)3. Our club avoids mutual funds but you could make an argument in this situation for a short term bond fund or etf to park some cash.On Mon, Jun 22, 2020 at 2:27 PM Laurie Frederiksen <laurie@bivio.biz> wrote:
Hi Liz,
Why doesn't it seem "fair" for members with a larger percentage of ownership to stop contributing temporarily to help reduce their ownership percentage compared to other members?
If you are going to make partial withdrawal payouts to members, you'll need to accumulate the cash to do so either from not investing member payments and other income you receive or by selling shares of stocks in your portfolio.
Laurie Frederiksen
Invest with your friends!
www.bivio.com
Become our Facebook friend! www.facebook.com/bivio
Follow us on twitter! www.twitter.com/bivio
Follow Us on Google+
Click here to Subscribe to the Club Cafe email list. Click here to UnsubscribeLiz,My first reaction is once a year the older members, especially those with larger shares, take partial withdrawals.That accomplishes several things. One it reduces their share of the overall portfolio, and, two, gives them some of their investment back to augment their incomes. Third, it keeps them involved in the club.LindaMy club has been active for several years and we have always treated the portfolio as a long term investment/savings/retirement tool. We have contributed dues consistently and we have only made withdrawals when members have left the club. So far this method has worked well for us, kept our accounting needs fairly simple, and overall our portfolio has done quite well.
Now, however, we are running into 2 issues:
1. Some of our members are reaching retirement and would like access to their money.
2. Some of our members, particularly some of our original members, have large stakes in our portfolio (10%, 12%, and up to 19%), and cashing out payments to these members would have a significant impact on our portfolio.
I'm looking for advice and best practices for making payments to active members. Ideally I would like to be able to make some sort of payments to these members without disrupting the portfolio too much and without making the accounting aspect too complicated.
I realize one way to adjust the portfolio % is to have our newer members contribute more money, but that is not always feasible and in some instances that would require the new member to pony up an unreasonable amount $$$.
Also, I could suggest the members with the bigger shares stop contributing, but that doesn't seem fair either and goes against most club principles.
What do you all do when a member wants to take out some of their money from the portfolio? We're all active members and would like to continue participating in the club so we don't want to disband or anything. All advice is appreciated. Thanks!
This is only true for a full withdrawal.
In a partial withdrawal the partner does assume the cost basis of the club. Things can get complicated.
A member can make a partial withdrawal up to their club cost basis without paying tax.
Charles Bard
From: club_cafe@bivio.com <club_cafe@bivio.com> On Behalf Of Irina Clements via bivio.com
Sent: Monday, June 22, 2020 3:56 PM
To: club_cafe@bivio.com
Subject: Re: [club_cafe] Making Payments to Active Members, not Withdrawals?
The investment club as entity has a cost basis for the stocks.
The individual who receives the stock in a withdrawal gets the new cost basis as the individual (not the basis that the club entity had).
Best, Irina
On Jun 22, 2020, at 3:17 PM, Rebecca Reeves via bivio.com <user*34255900001@bivio.com> wrote:

We transfer stocks to our withdrawing members plus some cash. We choose stocks that have the approximate amount of capital gain as the withdrawing member. In this way the remaining members do not have to pay capital gains when stock is sold. It is very easy to transfer stocks from our portfolio to the withdrawing member who opens an account at our brokerage.
|
This is only true for a full withdrawal.
In a partial withdrawal the partner does assume the cost basis of the club. Things can get complicated.
A member can make a partial withdrawal up to their club cost basis without paying tax.
Charles Bard
From: club_cafe@bivio.com <club_cafe@bivio.com> On Behalf Of Irina Clements via bivio.com
Sent: Monday, June 22, 2020 3:56 PM
To: club_cafe@bivio.com
Subject: Re: [club_cafe] Making Payments to Active Members, not Withdrawals?
The investment club as entity has a cost basis for the stocks.
The individual who receives the stock in a withdrawal gets the new cost basis as the individual (not the basis that the club entity had).
Best, Irina
On Jun 22, 2020, at 3:17 PM, Rebecca Reeves via bivio.com <user*34255900001@bivio.com> wrote:

We transfer stocks to our withdrawing members plus some cash. We choose stocks that have the approximate amount of capital gain as the withdrawing member. In this way the remaining members do not have to pay capital gains when stock is sold. It is very easy to transfer stocks from our portfolio to the withdrawing member who opens an account at our brokerage.
I you have to sell stock to pay out a withdrawal (Partnership Agreement states, pay by check - no option for transfer of stock) then all members will share in paying the capital gain tax from their K-1. Isn't this how Bivio accounts for sales?
Sent from my iPhone
On Jun 22, 2020, at 1:14 PM, Charles Bard via bivio.com <user*29623800001@bivio.com> wrote:
This is only true for a full withdrawal.
In a partial withdrawal the partner does assume the cost basis of the club. Things can get complicated.
A member can make a partial withdrawal up to their club cost basis without paying tax.
Charles Bard
From: club_cafe@bivio.com <club_cafe@bivio.com> On Behalf Of Irina Clements via bivio.com
Sent: Monday, June 22, 2020 3:56 PM
To: club_cafe@bivio.com
Subject: Re: [club_cafe] Making Payments to Active Members, not Withdrawals?The investment club as entity has a cost basis for the stocks.
The individual who receives the stock in a withdrawal gets the new cost basis as the individual (not the basis that the club entity had).
Best, Irina
On Jun 22, 2020, at 3:17 PM, Rebecca Reeves via bivio.com <user*34255900001@bivio.com> wrote:

We transfer stocks to our withdrawing members plus some cash. We choose stocks that have the approximate amount of capital gain as the withdrawing member. In this way the remaining members do not have to pay capital gains when stock is sold. It is very easy to transfer stocks from our portfolio to the withdrawing member who opens an account at our brokerage.
It's not bivio that determines how and when the capital gains are accounted for -- bivio reflects the IRS rules that govern this.
I you have to sell stock to pay out a withdrawal (Partnership Agreement states, pay by check - no option for transfer of stock) then all members will share in paying the capital gain tax from their K-1. Isn't this how Bivio accounts for sales?Sent from my iPhoneOn Jun 22, 2020, at 1:14 PM, Charles Bard via bivio.com <user*29623800001@bivio.com> wrote:This is only true for a full withdrawal.
In a partial withdrawal the partner does assume the cost basis of the club. Things can get complicated.
A member can make a partial withdrawal up to their club cost basis without paying tax.
Charles Bard
From: club_cafe@bivio.com <club_cafe@bivio.com> On Behalf Of Irina Clements via bivio.com
Sent: Monday, June 22, 2020 3:56 PM
To: club_cafe@bivio.com
Subject: Re: [club_cafe] Making Payments to Active Members, not Withdrawals?
The investment club as entity has a cost basis for the stocks.
The individual who receives the stock in a withdrawal gets the new cost basis as the individual (not the basis that the club entity had).
Best, Irina
On Jun 22, 2020, at 3:17 PM, Rebecca Reeves via bivio.com <user*34255900001@bivio.com> wrote:

We transfer stocks to our withdrawing members plus some cash. We choose stocks that have the approximate amount of capital gain as the withdrawing member. In this way the remaining members do not have to pay capital gains when stock is sold. It is very easy to transfer stocks from our portfolio to the withdrawing member who opens an account at our brokerage.
P Please consider the environment before printing this e-mail.
The most important thing to remember is that whether you take a partial withdrawal in cash or stock, whether the club sells stock or not, the capital gains tax that each member will pay over their tenure in the club will not change. The only thing that will change is the timing of when the taxes will be paid. (Note that this assumes constant tax rates.) Giving appreciated stock as part of a partial withdrawal will accelerate the capital gains tax for the recipient (assumes the partial withdrawal is because they need/want access to the cash value). Selling appreciated stock causes everyone to realize some capital gains now rather than later. Any gain taken now, increases the member's tax basis in the club and reduces the capital gains tax to be paid in the future. The software will correctly handle everything.
Ira Smilovitz
It's not bivio that determines how and when the capital gains are accounted for -- bivio reflects the IRS rules that govern this.I you have to sell stock to pay out a withdrawal (Partnership Agreement states, pay by check - no option for transfer of stock) then all members will share in paying the capital gain tax from their K-1. Isn't this how Bivio accounts for sales?Sent from my iPhoneOn Jun 22, 2020, at 1:14 PM, Charles Bard via bivio.com <user*29623800001@bivio.com> wrote:This is only true for a full withdrawal.
In a partial withdrawal the partner does assume the cost basis of the club. Things can get complicated.
A member can make a partial withdrawal up to their club cost basis without paying tax.
Charles Bard
From: club_cafe@bivio.com <club_cafe@bivio.com> On Behalf Of Irina Clements via bivio.com
Sent: Monday, June 22, 2020 3:56 PM
To: club_cafe@bivio.com
Subject: Re: [club_cafe] Making Payments to Active Members, not Withdrawals?
The investment club as entity has a cost basis for the stocks.
The individual who receives the stock in a withdrawal gets the new cost basis as the individual (not the basis that the club entity had).
Best, Irina
On Jun 22, 2020, at 3:17 PM, Rebecca Reeves via bivio.com <user*34255900001@bivio.com> wrote:

We transfer stocks to our withdrawing members plus some cash. We choose stocks that have the approximate amount of capital gain as the withdrawing member. In this way the remaining members do not have to pay capital gains when stock is sold. It is very easy to transfer stocks from our portfolio to the withdrawing member who opens an account at our brokerage.
--P Please consider the environment before printing this e-mail.