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TAXES!  You mean we have to pay taxes?

As the club has expenses, buys or sells stock, or receives dividends or interest, they create taxable transactions.  Uncle Sam expects to be told about this, whether you have a gain or loss, no matter how small.   Transactions through your bank or broker are reported to the IRS on forms 1099.  It is imperative that the club report the proper allocation of these items to their members through forms 1065 and K-1.

The club does not pay taxes.  As a partnership, the liability is passed through to the members.  The K-1 has the information they need to include these items on their individual tax filings, or include in material given to their tax preparer. Please see the Treasurer Tips on Paid in Plus Earnings – PIPE.

Tax reporting is not a big bugaboo.  The necessary IRS forms can be produced automatically by any of the Club Accounting software.  Tax form printing is included in the bivio products subscription fee (and also in their free trial).  With the ICLUBcentral products there is an additional annual fee for the "tax printer".

• Reconcile all statements and 1099’s, complete all postings.
• Some year-end tasks are required with IClubCentral software (but not with bivio):
  • Create a Valuation dated December 31st.
  • Run the Allocate Income and Expenses tool.
  • Purchase and download the appropriate Tax Printer(s).
• Confirm all Social Security Number’s are available, and addresses are current.  (You can delete the SSN’s after printing, if your members so wish.)
• Print two complete tax return sets (all forms), and one additional set of K-1’s.
• Send one complete set to the IRS.
• Give K-1’s to members, no later than March.  Retain one complete set in club records.

The most time-consuming part is waiting for all those sheets to print.  There now, wasn’t that easy?  And your club thinks you are a whiz!