When Are Investment Club Tax Forms Available

The program you will use to prepare your investment club federal taxes is included in your bivio subscription. It is usually available for you in mid February.

Some people ask why they can't have it sooner. There are two reasons:

  1. We need to complete the programming.

    We can't finalize the programs until the tax authorities release the final version of the forms. Partnership forms aren't the highest priority because there are fewer partnership returns filed than other types of return. Changes, sometimes minor, sometimes major, are made up until the release of final forms.

    Final partnership forms are typically released in late December - early February (yes 5-6 weeks after the end of the tax year).

    This isn't the end of the story. Once we have the forms and create the program we have to confirm that the program functions as intended. We also generally must submit samples of forms and/or completed test returns to the relevant tax authorities for final approval for filing and for e-filing.

    Until all this is done, we can only release the software if any forms generated contain obvious watermarks indicating that the generated form cannot be filed.

  2. You cannot prepare tax forms until you receive your 1099's

    You can't prepare partnership taxes until you have received all the tax information from the companies you have invested in. Brokers have until February 15 to get you that information on 1099 forms but some brokers may indicate on their websites that they will be even later than that. It's important to check your clubs brokerage site.

    You need to have them. You can't prepare your club taxes without them.

    There is often information on the 1099's that is not known until you get them. It may require adjustments in your accounting to prepare your taxes correctly. Neither your club nor your members want to have to file amended returns because you sent in incorrect filings.

The good news is that the biggest time consuming part of preparing taxes is making sure your records are correct. You don't have to wait to start that.

  1. Every time you have a sale during the year you can check your capital gains and losses to make sure bivio agrees with your brokerage records. Here's how to do that:

    Checking Your Cost Basis

  2. Once you have your final monthly statements for the year you can run a club audit. Here's how to do that:

    How To Do A Club Audit

  3. Late in the year, you can visit the investor relations pages for your investments to see if there are any adjustments you need to make to any distributions you've received.

If you do all that, any final issues when you get your 1099's should be small. If you get them before the tax program is released, compare them to the bivio 1099-DIV and 1099-B review reports you can find on the Accounting>Reports page. Once any final adjustments are made, it will only a few minutes to run through the tax interview and generate the forms that need to be filed and distributed when the program is released.

If your members need a preliminary estimate of what will be being reported on their K-1's, they can get it from the Member Tax Allocations report. Just remember to remind them it is only preliminary and subject to any changes that you make as you go through the steps to verify your records.

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