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Handling a late payor and associated unit values
Dieter Louis wrote, We have an individual who is often two weeks late. The partnership wants me to reduce his units for the amount of the late period per our agreement. When I use the "two weeks late date," the valuation still calculates the same ...
4 messages
Questions about partnership agreements
Brad asked several great questions about some rather standard paragraphs found in many investment partnership agreements. "Any corporation or transfer agent called upon to transfer any securities to or from the name of the partnership shall be entitled to rely on instructions or assignments signed ...
1 message
Partnership Agreements- The treasurers' perspective (Accounts)
Jerry, I'm the treasurer of a new club and we are in the process of writing our partnership agreement. Specifically, as treasurer, what issues should I be most concerned with? Let's finish our discussion of the treasurers' perspective of the partnership agreement by highlighting several ...
4 messages
Member fees vs. club startup expenses
Norm Osterman wrote Being we are starting investment club #2 I am wondering if the correct procedure is to place an assessment fee on the members for startup costs. I did this prior with our other club but it might be better to use the ...
1 message
Ford Recapitalization - Part Cash Option
This is part of a continuing series on mergers, spin-offs, and stock splits. In early August of 2000, Ford Motor Company completed a recapitalization/merger plan. Under this plan, a shareholder could exchange stock for 1.748 shares of new Ford stock, or could receive 1 new ...
1 message
Ford Recapitalization - All Stock Option
This is part of a continuing series on mergers, spin-offs, and stock splits. In early August of 2000, Ford Motor Company completed a recapitalization/merger plan. Under this plan, a shareholder could exchange stock for 1.748 shares of new Ford stock, or could receive 1 new ...
1 message
To Incorporate Or Not Incorporate
George Fernett wrote Lately, we have been hearing that we should "incorporate" our club, to protect each individual from any problems (lawsuits, etc) that might occur for whatever reason. Most clubs form as partnerships since the potential risk of liability is very small. Unless a ...
4 messages
Ford/Visteon Spin Off
This is part of a continuing series on entering Spin Offs and Mergers in bivio and NCA. Ford Motor Company [F] spun off Visteon [VC] as of 6/28/00. Shareholder were to receive .130933 Visteon shares for each Ford share held. The tax basis for the ...
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Does an investment club have to file a partnership return
A frequent question is about the need to file a partnership return, Form 1065. Rip, you are always recommending that investment clubs file a partnership return. Isn't there an exception that says an investing partnership can elect not to do this. If so, wouldn't the ...
5 messages
Do we have to file if we are just starting and have no stock purchases?
This question is often asked Our club just started in November. We have not bought any stocks yet. Do we still have to file a partnership income tax return. It depends on whether you mean 'have to' or 'should'. The instructions for the federal partnership ...
3 messages
Tax distributions (allocations) in a general partnership?
Jamie wrote My club is formed as a general partnership. Our members, however, do not invest the same amounts every month, so there are some wide gaps in ownership percentages. I have recently read that in a general partnership, taxes will be divided equally among ...
1 message
How to transfer stock to withdrawing members of a club.
Recently Tim K. Kessler asked Our club's by-laws allow the transfer of securities to a withdrawing member. However, most of our members do not have brokerage accounts and invest in the stock market only through our club. How does a club handle a withdrawal for ...
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IRS Publications 541 and 550 now available
The two most commonly cited IRS Publications relative to investment clubs are IRS Publication #541 - Partnerships and IRS Publication #550 - Investment Income and Expenses The latest versions (1999 tax year) of each are available in the Trez_Talk files area. You'll find them in ...
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Spinoffs and Mergers - cost basis allocations and tax considerations
Corporate mergers and spin-offs are the source of many questions from individuals and investment clubs. These questions usually focus on the calculation or allocation of cost basis and the determination of the holding period related to the sale of a security that was obtained as ...
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Refundable Fees - A Reader Dares to Disagree <g>
Deborah Kearney courageously <g> disagrees with a recent column on non-refundable fees. She says I disagree - a fee is a fee is a fee. Well, each club, of course, is free to set its own policy. Having dealt with these questions for many years, ...
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