Our club was started on August 20, 1963. We do not file
taxes as a club, but individually. In 1997 the IRS declared
that Investment Clubs that were formed before 1997 would
continue to file separately, and their rules would not
change.

Will we have any problems, now that our Broker is
Ameritrade, and we have signed up for your service?

Our club signed up with Ameritrade in 2006, and we didn't
hear anything about taxes from them. We plan to handle our
taxes as usual, unless you think we should be filing as a
club.
Please advise.

Well, are you, or are you not, a partnership?
In whose name, and under what Tax ID, is your bank account?.
In whose name, and under what Tax ID, is your brokerage
account?
So you must have previously been manually attributing each
quarterly dividend, each monthly interest income, each
gain/loss amongst each member. What a chore!!! How many man
hours does that take in a year? Divided by $99, is that
minimum wage?
That aside, since you're paying $99/year for recordkeeping,
wouldn't it be easier to just let Bivio do their job, and
all you'd have to do was print and attach the K-1s to the
individuals' tax returns? Else, why use Bivio?

Beth A Theiss wrote:
> Our club was started on August 20, 1963. We do not file
> taxes as a club, but individually. In 1997 the IRS declared
> that Investment Clubs that were formed before 1997 would
> continue to file separately, and their rules would not
> change.
>
> Will we have any problems, now that our Broker is
> Ameritrade, and we have signed up for your service?
>
> Our club signed up with Ameritrade in 2006, and we didn't
> hear anything about taxes from them. We plan to handle our
> taxes as usual, unless you think we should be filing as a
> club.
> Please advise.

Thomas, in answer to your questions on your reply of
01/06/2009, we are a partnership with a Fed ID # on our
Ameritrade Account. We no longer have a bank acct since we
can write checks on the broker acct.

As for "Manually" entering all the information, I have used
the NAIC Easyware since 1989. I have given each member the
Distribution of Earnings Report at the end of the year. and
we each file the tax individually. We are going by the
ruling in 1997, Publication 550 that states that:

"An investment club that existed before 1997 is treated
for 1997 and later years the same way it was treated before
1997", unless it chooses to be treated a different way under
the new rules. To make that choice, the club must file Form
8832, Entity Classification Election."

We have kept this rule in place all these years, and have
not had any correspondence from the IRS, so I assume that we
ARE complying with the IRS rules.
However, if we are NOT in compliance, filing taxes will no
longer be a problem, not that we have subscribed to Bivio.

(I found Bivio when I was checking for NAIC Easyware
updated software. I am delighted to find this because it
takes a real load off my work. The best part is that I was
able to import the Easyware files directly into Bivio and
everything is in balance with my old program.

Now every member can use the website and print reports for
the meeting instead of me doing it every month.

I highly recommend Bivio, and am thinking of starting
another club, now that the treasurer's job is so simplified.












Thomas Hardy wrote:
> Well, are you, or are you not, a partnership?
> In whose name, and under what Tax ID, is your bank account?.
> In whose name, and under what Tax ID, is your brokerage
> account?
> So you must have previously been manually attributing each
> quarterly dividend, each monthly interest income, each
> gain/loss amongst each member. What a chore!!! How many man
> hours does that take in a year? Divided by $99, is that
> minimum wage?
> That aside, since you're paying $99/year for recordkeeping,
> wouldn't it be easier to just let Bivio do their job, and
> all you'd have to do was print and attach the K-1s to the
> individuals' tax returns? Else, why use Bivio?
>
> Beth A Theiss wrote:
> > Our club was started on August 20, 1963. We do not file
> > taxes as a club, but individually. In 1997 the IRS declared
> > that Investment Clubs that were formed before 1997 would
> > continue to file separately, and their rules would not
> > change.
> >
> > Will we have any problems, now that our Broker is
> > Ameritrade, and we have signed up for your service?
> >
> > Our club signed up with Ameritrade in 2006, and we didn't
> > hear anything about taxes from them. We plan to handle our
> > taxes as usual, unless you think we should be filing as a
> > club.
> > Please advise.

Rip West, Thanks for your reply.
To eliminate the confusion, I have been printing a
"Distribution of Earnings Report" from the NAIC Easyware for
each member to add to their individual federal tax forms.
We have a Fed ID # which is on this report.

We have been going by the 1997 IRS Publication 500 where it
states, "An Investment Club formed before 1997, is treated
for 1997 and later years the same way it was treated before
1997, unless it chooses to be treated a different way under
the new rules. To make that choice, the club must file Form
8832, Entity Classification Election"

We chose to continue as before 1997, and have not received
any communication from the IRS, so we hopefully
are in compliance with the IRS rules for filing.

Now that we have subscribed to Bivio, filing taxes are not a
problem, however, don't you think we should continue doing
what we are doing???

If you know of any changes in this rule we are going by,
please advise. Thanks for your help.






Rip West wrote:
> <<
> In 1997 the IRS declared that Investment Clubs that were formed before 1997
> would continue to file separately, and their rules would not
> change.
> >>
>  
> I think there may be some confusion, here. I know of no 'declaration' by
> the IRS that clubs formed before 1997 would continue  to file separately.
> What exactly do you mean by 'file separately'. I suspect that  you mean
> that you just don't file a partnership return and each partner picks up his/her
> share of the total club income on the personal return. If that is the case, then
> you are NOT complying with the IRS rules for filing. If, on the other hand, you
> are filing as co-owners, and are reporting each partner's share of EACH dividend
> and EACH expense, as Thomas Hardy suggests, then you are going to a lot of extra
> work, and still are probably not in compliance. Look at http://www.bivio.com/trez_talk/mail-msg?t=101500003 for
> an article that I wrote on this subject.
>  
> <<
> Our club signed up with Ameritrade in 2006, and we didn't hear anything
> about taxes from them.
> >>
>  
> Well, you won't hear anything from your broker about taxes, except for the
> 1099s that they send you relating to the dividends received from each
> company.
>  
> If  you could clarify what you mean by 'not filing as a club, but
> individually', we probably could provide better guidance.
>  
>  
> Rip West
> Saint Paul, MN
>