| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
|---|---|---|---|---|---|
| #7348 | Closed | public | Multifamily | Les Sparks |
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I have a client whose preliminary 12/31/16 surplus cash calculation showed surplus cash but he did not take a distribution in January. Can distributions of surplus cash only be taken in January and July, immediately after the calculation, or can distributions be taken at a later date? The regulatory agreement only says “distributions shall be made only after the end of a semiannual or annual fiscal period”. How liberal is this rule? |
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From Les Sparks: The distributions can be taken anytime after January 1st and up to June 30th. After June 30, there is a new calculation of surplus cash and it all starts over. Then distributions begin again. Clients sometimes want the cumulative number to be available. This look like this December 15 surplus cash = 100,000. June 2016 equals 100,000. Therefore the client can distribute 200K for the year. However, if the client only took $50K int he first 6 months and had $100k in surplus cash at June, then they could only take $150k for the year due to the reset at June. |