Finance Questions

Posts Tagged ‘investment club’

How are Investment Clubs organized?

Since a partnership is the most common form of organization, this memo will primarily discuss that type of entity. A partnership is where a group of individuals pool their resources and share gains and losses among the members of the group. The partnership generally does not have to be formally organized. A W-9 Form, Account Agreement, and an Investment Club Certification of Investment Powers are needed to open up an investment club account. If there are four or fewer participants, a tenants-in-common account could be used instead of the investment club status. 
In order to set up an investment club as a partnership, trust, or corporation the entity would have to obtain a tax identification number by filing out Form SS-4. The identification number may be obtained by phone from the IRS. The numbers to call are listed by region in the instructions to Form SS-4. Go to the IRS web site or call the IRS at (800) 829-1040. 

Where can I find more information on Investment Clubs?

Many books are available at bookstores on this subject.