Changing a fee to Units

Eric From on

Last year our club members paid a fee of $50 each. We
decided a couple months ago to refund back $10 per person
and purchase units for them. Is there a way to do this? If
i do a withdrawal it takes units away from member. We want
to withdraw from a fee payment and make a regular payment.
Can anyone help?

Eric From
Nationwide Investment Club Treasurer

Laurie Frederiksen on

Hi Eric,

You could record a non deductible expense of $10*(Number of Club members). Follow it by recording a
payment for each member for $10.

Laurie Frederiksen
bivio Inc.

Rip West on

Eric,

You could enter a negative fee of $10 for each member, and then a payment of $10 for each. You enter a negative fee by enclosing the amount in brackets like (10.00). Doing this will reduce the value of the larger unit holders and increase the value of the lesser unit holders. That is to be expected because whenever you record a fee, the larger unit holders benefit at the expense of the lesser holders.

Using Lorrie's suggestion of a non-deductible expense followed by payments would have no effect unless you allocate the non-deductible expense equally. Then you would get the same result as entering negative fees. There would be no point in using the non-deductible expense method unless you are going to allocate equally, since it changes nothing.

Rip West
Saint Paul, MN

Eric From on

Thanks for the input.

Eric

Eric From wrote:
> Last year our club members paid a fee of $50 each. We
> decided a couple months ago to refund back $10 per person
> and purchase units for them. Is there a way to do this? If
> i do a withdrawal it takes units away from member. We want
> to withdraw from a fee payment and make a regular payment.
> Can anyone help?
>
> Eric From
> Nationwide Investment Club Treasurer

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