We are a newer club, sold no stock, and the fee for Bivio,
which is deductible is greater than our dividend income. We
also had some broker fees (monthly fee at B&H) that are
probably also deductible.
So far we are a truly non profit organization. We will do
better next year.
Will the members of our club need to receive tax forms when
we had no income?

If you have a federal tax EIN, the IRS expects to get a Form
1065. If you had any income (dividends, interest, etc.) or
any deductible expenses (NAIC dues, bivio bookkeeping fees,
etc.) you will have to provide your members with K-1s.

The penalty for failure to file and failure to provide K-1s
is far greater than the amounts you will be reporting.

In my club's first year, we had $.82 of interest to split 9
ways. We filed.

Ira Smilovitz
Lakshmi Investments, LLC

Joe Chambers wrote:
> We are a newer club, sold no stock, and the fee for Bivio,
> which is deductible is greater than our dividend income. We
> also had some broker fees (monthly fee at B&H) that are
> probably also deductible.
> So far we are a truly non profit organization. We will do
> better next year.
> Will the members of our club need to receive tax forms when
> we had no income?

Ira Smilovitz wrote:
> > In my club's first year, we had $.82 of interest to split 9
> ways. We filed.
>
> Ira Smilovitz
> Lakshmi Investments, LLC

I've been trying to convince my members of this too! I am
the treasurer and will do the IRS reporting for the club. I
also will include this on my personal income tax. But at
our last meetings a few members were saying that they
probably will not file the K-1 with their taxes since it is
an insignificant gain or a small loss. I totally agree
with you - file no matter what!

Elizabeth,

There are two issues here: Club tax reporting and individual
tax reporting.

The club has to file even if there is no income because the
penalties for not-filing are outrageously steep. The penalty
is assessed on the return and on each K-1 not filed.

If there is very little or no income at the individual
partner level, his/her decision to not report is not as
serious. Legally, of course, you must report all income.
However, the IRS prefers that you report income in whole
dollars, and, if your taxable income is less than $100,000,
you generally use the tax tables which have $50-wide
brackets. So if the total income from the partnership isn't
enough to bump you over the next $50 break, there's no
effect on your tax.

Hope this helps explain things somewhat.

Ira Smilovitz
Lakshmi Investments, LLC

Elizabeth Darling wrote:
> Ira Smilovitz wrote:
> > > In my club's first year, we had $.82 of interest to split 9
> > ways. We filed.
> >
> > Ira Smilovitz
> > Lakshmi Investments, LLC
>
> I've been trying to convince my members of this too! I am
> the treasurer and will do the IRS reporting for the club. I
> also will include this on my personal income tax. But at
> our last meetings a few members were saying that they
> probably will not file the K-1 with their taxes since it is
> an insignificant gain or a small loss. I totally agree
> with you - file no matter what!