Accounting for Inactive Member
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Accounting for Inactive Member How do you account for an inactive member who is still considered a partner but during this inactive period the partner does not pay dues nor received any portion of late fees and miscellenous income during this period. (However, the operating policy allow for the partner to participate in gains & losses during this period.) It appears that the site does not allow for a member to be inactive without being totally withdrawn from the club? The site also allocates the fee and miscellenous income collected to this inactive partner. Any advice or sugguestions? Keesha Cooper wrote: > How do you account for an inactive member who is still > considered a partner but during this inactive period the > partner does not pay dues nor received any portion of late > fees and miscellenous income during this period. We do not support this. I have my doubts as to whether the IRS would allow this. As long as the inactive member has a material participation in the club, it's likely the IRS would require a proportional distribution of income and expenses. I'm neither a lawyer or accountant. You should consult a professional advisor if you are in doubt about what to do. Rob Rob Nagler wrote: > Keesha Cooper wrote: > > How do you account for an inactive member who is still > > considered a partner but during this inactive period the > > partner does not pay dues nor received any portion of late > > fees and miscellenous income during this period. > > We do not support this. I have my doubts as to whether the IRS > would allow this. As long as the inactive member has a material > participation in the club, it's likely the IRS would require a > proportional distribution of income and expenses. > > I'm neither a lawyer or accountant. You should consult a > professional advisor if you are in doubt about what to do. > > Rob I believe Keesha may have more than an IRS problem. Inactive partners also create SEC problems. Debi |
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