Member Death

CAROLE J TAYLOR on

A member passed away. Her two daughters and daughter-in-law
are also members.Is there away we can transfer her units to
them?
Carole

iras1 on

You can but you shouldn't. There is no way that the club can know what the provisions of the decedent's will are. Additionally, even if the three of them are the rightful beneficiaries, any amount they would receive would have a separate cost basis (equal to the value on the date of death) so it isn't as simple a transaction (in the software) as you might think. The club and each of the remaining members are exposed to risk should the club distribute the decedent's share to someone not entitled to it. Any one of them, individually or collectively, could be held liable to replace the misdistributed amount.

It is ALWAYS best to follow the Partnership Agreement and process as a complete withdrawal paid to the Estate of the decedent. Let the Estate's Executor do his/her job.

Ira Smilovitz

Join me at InvestEd 2010

Investor Education at Its Best^TM
Baltimore, MD August 6 - 8, 2010
http://www.investor-education2010.org/

In a message dated 10/15/09 22:21:29 Eastern Daylight Time, cooper9@bivio.com writes:

A member passed away. Her two daughters and daughter-in-law
are also members.Is there away we can transfer her units to
them?

Myrelle on

In the past when I was an active member in the investment club, one of our rules was changed and added to the Articles of Association and that was to treat the situation as a withdrawal. When the numbers were available, a check was written to "The Estate of Jane Doe" and that closed the file and left the dispersal of funds to the Estate of the member.

If the daughters want to become active in the club, they can then cash the check and buy in as members on their own. The choice would be theirs and not from the decision of the club.

Myrelle

iras1 wrote:

You can but you shouldn't. There is no way that the club can know what the provisions of the decedent's will are. Additionally, even if the three of them are the rightful beneficiaries, any amount they would receive would have a separate cost basis (equal to the value on the date of death) so it isn't as simple a transaction (in the software) as you might think. The club and each of the remaining members are exposed to risk should the club distribute the decedent's share to someone not entitled to it. Any one of them, individually or collectively, could be held liable to replace the misdistributed amount.

It is ALWAYS best to follow the Partnership Agreement and process as a complete withdrawal paid to the Estate of the decedent. Let the Estate's Executor do his/her job.

Ira Smilovitz

Join me at InvestEd 2010

Investor Education at Its Best^TM
Baltimore, MD August 6 - 8, 2010
http://www.investor-education2010.org/

In a message dated 10/15/09 22:21:29 Eastern Daylight Time, cooper9@bivio.com writes:

A member passed away. Her two daughters and daughter-in-law
are also members.Is there away we can transfer her units to
them?

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