Timing of Distributions related to Timing of Surplus Cash Calc

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ID Status Date Public/Private Industry AHACPA Contact
#18285 Closed public Multifamily Les Sparks
Customer Reply

Hi Les,

I have a client with a 06/18 Regulatory Agreement.  They prefer to take their distribution in Q3 of each year, but no other time of the year.  This posed a couple questions that I was hoping you could answer.

– If Surplus Cash is calculated at 12/31/22, as long as they don’t take a distribution in first 6 months, may the client take a distribution 7/1 or later, subject to that 12/31/22 SC calc?
– Is the client required to perform a mid-year calculation at 6/30/23 if they are looking to take a distribution in Q3 2023?
– To ask another way, if client does a 12/31/22 SC calc, do they have a 6 month clock to take the distribution?

Thanks!
Ben
Les Sparks

Ben, I think the best answer is to base the distribution on a June 30th calculation. Then they can take full advantage of any additional cash that may have been generated. Of course, if the amount is less, then just use the December calculation and do not submit a mid-year calculation at the next year end.

 

Les Sparks
AHACPA | 459 N 300 W #10 | Kaysville, UT 84037 | Phone: 801-547-0809
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From: AHACPA Support <support@ahacpa.org>
Sent: Monday, April 10, 2023 12:37 PM
To: les@ahacpa.org
Subject: Timing of Distributions related to Timing of Surplus Cash Calc [NEW]

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