Tax basis for individual members

Robert Butz on

Could someone explain the tax basis for individual members.
The members of my club are questioning it. Examples:

Member total paid tax basis market value

xxxx 1694 5565.44 2247.13

ABCD 493.15 3611.76 2475.22

  Do these members have a perceived tax lost or is it a
  gain/lost vs what they have paid in.

                             Thanks

                                    Bob Butz

Laurie Frederiksen on

Hi Bob,

When you contribute to your club, you invest in a partnership which is a capital asset. You have a tax basis in that asset. That is your Member tax basis

The help topic describing the Member Status report gives a description of how it is calculated:

Member Status Report

Your member tax basis ultimately affects the amount of capital gain or loss you will report when you withdraw from the club. That is shown on a withdrawal report and is described here:

Withdrawal Report

Laurie Frederiksen
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On Fri, Jan 30, 2015 at 4:21 PM, Robert Butz <rbutz1@comcast.net> wrote:

Could someone explain the tax basis for individual members.
The members of my club are questioning it. Examples:

Member total paid tax basis market value

xxxx 1694 5565.44 2247.13

ABCD 493.15 3611.76 2475.22

Do these members have a perceived tax lost or is it a
gain/lost vs what they have paid in.

Thanks

Bob Butz

Linda on

Market value minus tax basis equals the member's gain or loss to be entered
on Schedule D if they were to sell their units.
Every year partners receive a K-1 that reports income, losses, and
deductions that each member includes on their tax return and pays taxes on
those amounts. Tax basis includes contributions plus income previously
reported, or minus losses and deductions.
The income a partnership earns or losses that are realized remain in the
partnership and are not distributed to members, therefore the basis of the
members must change so you don't get taxed twice when you make a withdrawal
from the club.
I hope that helps.
Linda
Pointe Players

-----Original Message-----
From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of Robert
Butz
Sent: Friday, January 30, 2015 4:21 PM
To: club_cafe@bivio.com
Subject: [club_cafe] Tax basis for individual members

Could someone explain the tax basis for individual members.
The members of my club are questioning it. Examples:

Member total paid tax basis market value

xxxx 1694 5565.44 2247.13

ABCD 493.15 3611.76 2475.22

  Do these members have a perceived tax lost or is it a
  gain/lost vs what they have paid in.

                             Thanks

                                    Bob Butz

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