DRIPS
| HelpRegister |
DRIPS Does your club use DRIPs or do your dividends just get added to your account balance? Thanks Kim Potter BI Brighton Model Club Hi Kim My club does not use drips. We use the dividends for other purchases. Does your club use DRIPs or do your dividends just get added Donna O'Connell We have the cash added to our account, When we first started (over 20y ago), we did drip our stocks, but with changes in the tax laws, it became a huge headache to keep track of, so we take the cash now. > On Feb 4, 2026, at 5:07â¯PM, Kimberley A Potter via bivio.com <user*22890200001@bivio.com> wrote: > > Does your club use DRIPs or do your dividends just get added > to your account balance? > > Thanks > Kim Potter > BI Brighton Model Club Please educate me. What does this mean? Tom Cryer Tomcryer@me.com 303-638-3202 > On Feb 4, 2026, at 4:07â¯PM, Kimberley A Potter via bivio.com <user*22890200001@bivio.com> wrote: > > Does your club use DRIPs or do your dividends just get added > to your account balance? > > Thanks > Kim Potter > BI Brighton Model Club "DRIPS" are Dividend Reinvestment Plans. They plans set up with your broker to automatically buy more shares of a stock with that stock's dividends. They are useful when used in retirement accounts. But when used in retail accounts they become an tax accounting nightmare. You have to record the cost basis for every transaction, the same as a stock purchase. More times than not you are purchasing fractional shares. Investment clubs are further ahead to use the dividends to build cash for normal stock purchases agreed upon by the partners. Gary Sergio Sidney Investment Club > On Feb 4, 2026, at 9:54â¯PM, Tom Cryer via bivio.com <user*41178800001@bivio.com> wrote: > > Please educate me. What does this mean? > > Tom Cryer > Tomcryer@me.com > 303-638-3202 > >> On Feb 4, 2026, at 4:07â¯PM, Kimberley A Potter via bivio.com <user*22890200001@bivio.com> wrote: >> >> Does your club use DRIPs or do your dividends just get added >> to your account balance? >> >> Thanks >> Kim Potter >> BI Brighton Model Club What is the tax accounting nightmare? > On Feb 4, 2026, at 4:51 PM, MARY FRAN NOVAK via bivio.com <user*7094300001@bivio.com> wrote: > > We have the cash added to our account, When we first started (over 20y ago), we did drip our stocks, but with changes in the tax laws, it became a huge headache to keep track of, so we take the cash now. > >> On Feb 4, 2026, at 5:07â¯PM, Kimberley A Potter via bivio.com <user*22890200001@bivio.com> wrote: >> >> Does your club use DRIPs or do your dividends just get added >> to your account balance? >> >> Thanks >> Kim Potter >> BI Brighton Model Club > Doesnât Bivio do our K1s so we donât need to do all that? Or is it based upon whether a club is an LLC or something. Iâm obviously lost here. > On Feb 4, 2026, at 4:51 PM, MARY FRAN NOVAK via bivio.com <user*7094300001@bivio.com> wrote: > > We have the cash added to our account, When we first started (over 20y ago), we did drip our stocks, but with changes in the tax laws, it became a huge headache to keep track of, so we take the cash now. > >> On Feb 4, 2026, at 5:07â¯PM, Kimberley A Potter via bivio.com <user*22890200001@bivio.com> wrote: >> >> Does your club use DRIPs or do your dividends just get added >> to your account balance? >> >> Thanks >> Kim Potter >> BI Brighton Model Club > The problem arises when you sell the shares and you have dozens of small transactions for each sale Your tax return may contain many pages of Form 8949 detailing each reinvestment transaction. Matching the purchase date and cost basis between bivio and the broker is tedious. The same problems occur during a merger, spin-off, or split. If you change brokers, most will not transfer fractional shares. All in all there are lots of headaches with DRIPs. Ira Smilovitz Doesn't Bivio do our K1s so we don't need to do all that? Or is it based upon whether a club is an LLC or something. I'm obviously lost here. Thank You! Tom Cryer Tomcryer@me.com 303-638-3202 > On Feb 4, 2026, at 8:51â¯PM, Gary & Claudia via bivio.com <user*35169000001@bivio.com> wrote: > > "DRIPS" are Dividend Reinvestment Plans. They plans set up with your broker to automatically buy more shares of a stock with that stock's dividends. They are useful when used in retirement accounts. But when used in retail accounts they become an tax accounting nightmare. You have to record the cost basis for every transaction, the same as a stock purchase. More times than not you are purchasing fractional shares. Investment clubs are further ahead to use the dividends to build cash for normal stock purchases agreed upon by the partners. > > Gary Sergio > Sidney Investment Club > >> On Feb 4, 2026, at 9:54â¯PM, Tom Cryer via bivio.com <user*41178800001@bivio.com> wrote: >> >> Please educate me. What does this mean? >> >> Tom Cryer >> Tomcryer@me.com >> 303-638-3202 >> >>>> On Feb 4, 2026, at 4:07â¯PM, Kimberley A Potter via bivio.com <user*22890200001@bivio.com> wrote: >>> >>> Does your club use DRIPs or do your dividends just get added >>> to your account balance? >>> >>> Thanks >>> Kim Potter >>> BI Brighton Model Club > Your treasurer will thank you not to do DRIPS Thank You! |
|
||||||