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Capital Credits

When you signed up for electric cooperative service with Tipmont, you became a member of a non-profit cooperative. As a non-profit cooperative, Tipmont does not technically earn profits. Instead, any revenues left over after covering our operating expenses and saving for emergencies are allocated back to our members. These allocations are called capital credits.

Because Tipmont’s operations are being efficiently run, our Board of Directors is able to return these capital credits to our members. It’s proof that we’re good stewards of your cooperative.

Looking For Unclaimed Credits?

Our unclaimed capital credits were turned over to the state government. Please use IndianaUnclaimed.gov to search for unclaimed capital credits.

The Process

How Capital Credits Work

  1. Tipmont tracks how much electricity you buy and how much money you pay for it throughout the year.

  2. At the end of the year, Tipmont completes financial matters and determines whether there is excess revenue, called margins.

  3. Tipmont allocates the margins to members as capital credits based upon their use of electricity during the year.

  4. When Tipmont’s financial condition permits, your Board of Directors decides to retire, or pay, the capital credits.

  5. Tipmont notifies you of how and when you will receive your capital credit retirement.

Capital CreditS

Frequently Asked Questions

Get answers to your questions about capital credits. 

Because Tipmont is a cooperative, owned by its members, it does not technically earn profits. Instead, if revenues exceed the cost of doing business (expenses), Tipmont has earned “margins” (profits). Each year, margins earned are allocated to Tipmont members based on how much electricity that member purchased during that year. These allocations are called capital credits.

Member-owned, not-for-profit electric co-ops set rates to generate enough money to pay operating costs, make payments on any loans, and provide an emergency reserve. At the end of each year, we subtract operating expenses from the operating revenue collected during the year. The balance is called an operating “margin.”

Allocated capital credits appear as an entry on the permanent financial records of the association and reflect your equity or ownership in Tipmont. When capital credits are retired, a check is issued to you and your equity in the cooperative is reduced. Checks are generally issued 30 years after the year in which the margins were earned.

Not necessarily. The board of directors must authorize a retirement before you receive a check. When considering a retirement, the board analyzes Tipmont’s financial and will not authorize a retirement if the retirement is not in the best interest of Tipmont’s members.

Eligible members receiving less than $15 will receive a bill credit. Eligible members receiving more than $15 will receive a check in the mail. If you have moved out of Tipmont’s service area, it is your responsibility to keep your address current with our records. Please call us at 800-726-3953 or visit our contact form to send us your current address.

Tipmont uses your investment in the cooperative to improve electrical infrastructure and ensure that there is enough money to ensure continuity of service. It’s a long-term investment to help Tipmont remain a stable and reliable electric provider.

Capital credits are calculated by Tipmont for everyone who purchased electricity during a year in which the utility earned margins. No special action is required to start a capital credits account. Your membership with Tipmont activates your capital credits account.

Capital credits are kept separate from your billing account and cannot automatically be applied to your electric account. When the board of directors decides to retire/return capital credits, Tipmont members will receive a check made payable to the member(s) listed on the account.

Yes. Tipmont has two community programs, Operation Round Up and EnviroWatts. Both programs are 501(c)(3) trusts, so the donations would be tax-deductible. Please contact Member Service at 800-726-3953 for more information.

Tipmont REMC requires proof that you are the legal recipient of the deceased estate. You must show all the documents stating you are the heir and sign a claim form.

We send checks to the last known address of former Tipmont members. Please mark “Return to Sender” on the envelope and put it back in the mail.

Capital credit checks must be cashed within 180 days (six months).

The capital credits you earned during your membership will be sent to eligible members as they are retired. It is the member’s or beneficiary’s responsibility to keep Tipmont informed of address changes. If the check is returned or not cashed within six months (180 days), your name will be listed in the Unclaimed Capital Credit Search. If such checks remain unclaimed or uncashed sixty (60) days after the announced retirement, the retirement funds will be transferred by Tipmont to an appropriate sub-account and assigned to other Tipmont patrons.

According to Tipmont’s bylaws, no interest shall accrue on these unclaimed funds.

Not necessarily. The total allocation must be over $15 for you to receive a check. If the amount is less than $15 and you are still an active member, you will receive a bill credit. If the amount is less than $15, and it is your final retirement, then you will receive a check for the remaining amount.

Capital credits are typically tax-free if the property served by Tipmont REMC was used as a residence. If the location served was used for business purposes, please consult a tax professional.
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