Due to the financial strain the owner discount puts on our Co-op, Mariposa’s Board of Delegates and management team have made the decision to move toward patronage refunds and discontinue the owner discount. The 5% owner discount will be discontinued at the end of the day on May 31st.
This year, 20% of 2016 profits made from owner sales ($12,042.38) will be distributed to owners as patronage. Please update your contact information to ensure your patronage refund arrives at your current address.
What is a patronage dividend or refund?
Patronage dividends, or refunds, are the cooperative method of sharing a co-op’s earnings with its owners in profitable years. Your patronage dividend is based on your purchases for that particular year and the profit that the co-op made on those purchases. Learn more about our decision to implement patronage refunds.
Will I get a patronage refund every year and whose decision is it?
Patronage can only be distributed in profitable years and at the discretion of the Board of Delegates. Typically, the General Manager recommends a number of options and the Board uses this information when making their decision.
Who qualifies for the patronage refund?
Owners who purchased retail products are eligible to receive dividends. Equity payments are not included in patronage dividends.
How is patronage calculated?
At the end of the fiscal year, after determining the amount of owner generated profit (based on the percentage of owners sales from total sales), the Board decides on a refund percentage to distribute, if any. According to the IRS, at least 20% of patronage must be distributed to the owners when a dividend has been declared (this is the “refund”). The Board may choose to retain up to 80% of the patronage dividend for projected capital expenses and other business needs.
How will I receive my patronage refund?
Mariposa will be mailing vouchers to each owner’s current address. Vouchers can be redeemed at the register for account credit or cash. Owners will have 90 days from when the vouchers are mailed to redeem their refund. Please make sure that your contact information is up to date so you receive your refund at your current address.
Do I have to claim this as income on my tax return?
No. The IRS regards this as a refund, not income. If you are a business, you may want to check with your tax preparer.