myICLUB Blog

There are important changes coming to myICLUB tax preparation for 2025, so make sure that your investment club members and treasurer have access to this information guide.

Proper preparation can minimize the stress of filing your investment club's tax returns. Here are important details for the 2025 tax year regarding IRS and state partnership tax returns.

Club Tax Essentials

The IRS and about half of all U.S. states require partnerships to file annual tax returns. Since most investment clubs are formed as partnerships, they fall under these legal requirements, and there are absolutely no exceptions and big penalties levied for late or missed filings.

Investing partnerships usually do not pay any taxes directly, but members are responsible for their share of club tax liabilities on their personal federal and state tax returns. 

Brokerage firms must provide clients with details of all relevant tax-year activity on Form 1099 by Monday, February 16, 2026 (though these forms are often delayed). The information on Form 1099 is required to prepare federal tax returns and report to members, and we recommend that you do not file tax returns until you have Form 1099 in hand and have verified that the details on the form match the club’s accounting records.

Partnerships must report partners’ tax liabilities on IRS Schedule K-1 (and in some cases also on Schedule K-3). These must be issued by Monday, March 16, 2026, to anyone who was a partner in the tax year. This way, partners have the information required for their personal tax returns.

The deadline for partnerships to file IRS returns is Monday, March 16, 2026 (moved since March 15, 2026, falls on a Sunday). Some states also use this date, but not all. If you are unsure of your ability to meet this deadline, you can request an extension (keep reading for details on our IRS Filing Extension e-Filing Service).

Read more on investment club tax basics.

What’s New for 2025

IRS Schedule K-2 and K-3 Exemptions

For the 2025 tax year, the Internal Revenue Service has eased requirements for partnerships that must file Schedule K-2 and K-3. These schedules report foreign income that is distributed to partners (such as dividends from non-U.S. stocks). Partnerships that qualify as “small partnerships” are now exempt from filing these forms.

Small partnerships are defined as those with total receipts for the year less than $250,000; have total assets with a cost basis less than $1 million; provide Schedules K-1 to partners by the return due date; and are not required to file Schedule M-3.

myICLUB Club Tax Federal — Deluxe

Because of the increasing complexity of complying with IRS regulations, we are expanding the rollout of myICLUB Club Tax Federal — Deluxe as the default version used by most clubs. These larger clubs are often required to file additional IRS forms that smaller clubs aren’t required to file.

Clubs that meet any of the following criteria must use the Deluxe version of Club Tax:

• Has 30 or more members (based on K-1s issued).
• Has a current asset value that exceeded $1 million at any time in the tax year.
• Had 250 or more security transactions in the year (includes buys, sells, distributions, reinvestments).
• Made any wash sale transactions in the tax year.
• Owned securities at any time in the year that issue Schedule K-1s (such as royalty trusts, limited partnerships, master limited partnerships).
• Though not required, elects to file Schedules L, M-1, or M-2.

Certain other complex transactions also require the Deluxe Add-on. These larger clubs are often required to file additional IRS forms that aren’t required by smaller clubs. The majority of myICLUB investment clubs will use myICLUB Club Tax Basic to prepare their federal return and won’t be affected by this change. Club Tax Federal – Basic will remain $99.99, while larger clubs receive additional support and functionality with the Deluxe Add-on (+$40.00). Deluxe users receive premium support online or by phone.

myICLUB Club Tax State

The IRS isn’t the only organization making returns more complicated. About half of all states require partnerships to file, and myICLUB Club Tax State now supports 16 of those with filing or e-Filing (see the complete list of supported states).

Many states are introducing new requirements, including filing mandates for non-resident partners. myICLUB Club Tax State for the 2025 tax year reflects some of these changes.

IRS e-File Form 7004 Request for Automatic Extension

With many brokerages expected to issue their Form 1099s past this year’s February 16th deadline, many clubs find it challenging to meet the IRS’s March 16th deadline. Fortunately, the IRS will grant automatic six-month extensions to partnerships that submit IRS Form 7004. While this form may be printed and mailed, the costs of USPS delivery with return receipt (required by the IRS to confirm receipt) can reach $18 or more.

Once again this year, myICLUB offers IRS Form 7004 e-Filing for just $13, a significant savings off the cost of printing and mailing (not to mention the time savings of not going to the Post Office!). With e-Filing, IRS confirmation is usually received within 10 minutes. Many clubs find it wise to request an extension if there is any doubt about their ability to meet the IRS March 16th filing deadline. There is no downside for requesting an extension and then filing on time, but there are significant penalties for filing after March 16th if an extension was not requested.

Investment Club Tax Calendar

Until the IRS releases final forms for the 2025 tax year, nothing is for certain! You can rely on our team to continue monitoring for changes that affect clubs and to let you know any items that require your attention.

Attending our tax-related webinars (or viewing them on our YouTube channel after the live presentation) is a great way to keep up to date with tax issues and the release of myICLUB.com Club Tax for 16 states and the IRS. See below for dates. Sign up for our entire club webinar series.

Upcoming Events

• 12/16/25: "Closing the Club's Books at Year-End" webinar
• 1/20/26: ”Preparing myICLUB Club Taxes" webinar
• 2/17/26: Delivery deadline for brokerage 1099s.
• 2/17/26: myICLUB Club Tax Clinic" webinar
• 3/16/26: Deadline for providing K-1s to club members.
• 3/16/26: Deadline for filing IRS Form 1065.

Annual Investment Club Audit

It is very important that club members audit the books every year. For a refresher or to learn how to conduct an audit, see the replay of our webinar “Conducting an Annual Investment Club Audit” on our YouTube channel.

You can download a free copy of our “Investment Club Annual Audit Checklist” from your club’s myICLUB.com File Storage.

Using myICLUB Club Tax

Despite the complexity of tax regulations for partnerships, myICLUB Club Tax makes it a snap to complete and file a club’s federal and state returns (now for 17 states). Besides the ease of filing, clubs can rack up big savings for tax preparation when compared to the prices charged by professional tax preparers. According to the National Society of Accountants, the average cost nationwide for preparation of IRS Form 1065 is $733 or $177.29 an hour, with additional charges for Schedule D, Schedule B, and other required schedules.

Each year, the IRS and states change their requirements and release new tax forms. This means myICLUB Club Tax must be updated each year (often significantly), and clubs must purchase the service each year.

myICLUB Club Tax modules for states and the IRS may be released at any point between January and March, depending on when IRS and state approvals are received. You can check the status of form releases on the myICLUB.com homepage during tax season or in the myICLUB.com Tax Center.

To pre-order myICLUB Club Tax Federal or Club Tax State for 2025, a club officer should visit the Taxes tab on your club’s myICLUB website or visit our Club Tax 2025 Store (myICLUB login required).

Say "Yes!" to e-Filing

myICLUB Club Tax supports e-Filing for the IRS and a growing number of states. We recommend filing electronically if at all possible to save on printing and mailing costs and ensure that you meet filing deadlines.

Getting Help During Tax Season

Our myICLUB support staff typically experiences a high volume of traffic by phone and online from December through March. For the most efficient service, here are some of the resources that are available to clubs who need help with myICLUB Club Tax.

Attend Our Webinars. Registration and replay links are in the Videos section of the myICLUB Help & Support Center. The sessions are useful for both new and experienced treasurers. Live webinars are scheduled as above, and replays are available on our YouTube channel after the live events.

Read the Quick Start and User Guides. These are linked at the top of the myICLUB Club Tax page after purchase, in the File Storage area of your myICLUB club website, or from the myICLUB Help & Support Center.

Ask Our AI Chatbot. Our new AI Chatbot can answer many questions about club tax preparation.

Frequently Asked Questions. Our Frequently Asked Questions (FAQ) tool addresses dozens of questions about club tax preparation and myICLUB Club Tax.

Submit Your Question Online. Use our Customer Support Hub to submit queries at any time of the day or night.

Call Us Toll-Free. Call 1-877-33-ICLUB (or 1-248-654-3100) from 9:30 am to 6:00 pm ET, Monday through Friday, to speak to a representative. On Thursday evenings, phone lines are open until 9:00 PM ET to benefit customers on the West Coast.

Whether this is your first or fortieth year coping with investment club taxes, we are confident that myICLUB’s top-notch tools will help you and your fellow club members prepare an accurate and timely tax return.

Ready to pre-order? Log in now to the myICLUB Club Tax Store to place your order!