Closing out the club books
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Closing out the club books Our club is in the process of disbanding and I would like to close the books in June. I have your guidance sheet "Disbanding a Partnership" which has been a great help. Thank you. I have one question however, after checking to see if all the dividends (those which we are eligible to receive) have been recorded in the club books. I have one more dividend that is expected on 6-21-11. It is one of two stocks that I will transfer to a member's account as part of her pay out. Can I assume that I do not have to wait until the dividend is paid to transfer the stock? Also, should all members be withdrawn or have stock transfers completed on the same date in June, given that we are using the club's agreed upon valuation date for May? Thanks for the help! Cindy Treasurer, Stockettes Dear Cynthia, If the stock is transferred before the ex dividend date, the new owner will receive the dividend. If the club still owns it on the ex dividend date, the club will receive it. If the club will receive the dividend, you will need to enter it in your records prior to determining what the value of each persons final payout is. You also couldn't actually make all the final payouts until you receive the dividend amount. I'd suggest you wait a little longer and then value everyones share and make your final payouts after all your income is received. I wouldn't transfer stock in a partial withdrawal to members. The cost basis issues and whether or not you get a cost basis benefit is more complicated for a partial withdrawal transfer than it is for a full withdrawal. On Thu, Jun 2, 2011 at 4:30 PM, Cynthia Johansson <skyfox@verizon.net> wrote: Our club is in the process of disbanding and I would like to -- Laurie Frederiksen Invest with your friends! www.bivio.com Become our Facebook friend! www.facebook.com/bivio Follow us on twitter! www.twitter.com/bivio |
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