Taking over another member's shares
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Taking over another member's shares Greetings, I'm not sure if this has come up before, but instead of a member withdrawing, is it possible for another member to take over their shares? In other words, one member will not have two spots in the club. Can we do this? In bivio? Will I have to let Scottrade know? I think I probably would, but wanted advice from you experienced folks. Thanks for your help! Johnny While it can be done, you don't want to do it as it will create all sorts of problems. It's much easier and cleaner to have the leaving member withdraw and have the other member contribute whatever money is necessary to purchase the same number of units, if that's what you want. Personally, I can't see why anyone would want to do this.
Ira Smilovitz
Join me at InvestEd 2010
Investor Education at Its BestTM Baltimore, MD August 6 - 8, 2010 http://www.investor-education2010.org/ In a message dated 02/23/10 21:23:10 Eastern Standard Time, duncanjohnny@bivio.com writes:
Ira, can you explain some of the problems that it will cause. I assume the person needs to withdrawl to assume any tax consenquences he or she has accrued. What are the other reasons not to do it? John Rice iras1 wrote: > While it can be done, you don't want to do it as it will create all sorts of problems. It's much easier and cleaner to have the leaving member withdraw and have the other member contribute whatever money is necessary to purchase the same number of units, if that's what you want. Personally, I can't see why anyone would want to do this. > > > > Ira Smilovitz > Join me at InvestEd 2010 > Investor Education at Its BestTM > Baltimore, MD August 6 - 8, 2010 > http://www.investor-education2010.org/ > > In a message dated 02/23/10 21:23:10 Eastern Standard Time, duncanjohnny@bivio.com writes: > > I'm not sure if this has come up before, but instead of a > member withdrawing, is it possible for another member to > take over their shares? In other words, one member will not > have two spots in the club. Can we do this? In bivio? > Will I have to let Scottrade know? I think I probably > would, but wanted advice from you experienced folks. > > > > There are gift tax considerations if the units are just transferred. You also have to determine what is the correct tax basis for the units - if transferred, they could be the tax basis of the withdrawing member or they could be the current value depending on whether the shares are worth more or less than the withdrawing member's tax basis. If purchased, they should be the current value.
Ira Smilovitz
Join me at InvestEd 2010
Investor Education at Its BestTM Baltimore, MD August 6 - 8, 2010 http://www.investor-education2010.org/ In a message dated 02/23/10 22:06:34 Eastern Standard Time, ricej1969@bivio.com writes:
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