What is patronage?
Patronage rebates are a portion of the net profit that The Merc Co+op makes from purchases returned to you, the owner.
Why pay patronage?
Patronage is one of the benefits of owning a share of the co-op. In addition, patronage is beneficial to the business. The Merc Co+op saves tax dollars by distributing patronage to our owners.
When is patronage determined?
We wait until our annual finances are finalized and then the Board of Directors votes on the recommended pay out. Owners should be on the lookout for more information at the Annual Co-op Meeting each November.
Who receives patronage rebates?
Owners in good standing as of June 30, the end of our fiscal year, who have sufficient patronage to balance the expense of distribution. Essentially, any owner who has made a certain amount of purchases (determined each year) recorded through our point-of-sale system between July 1 and June 30 of the following year will receive a rebate.
How can you use your patronage rebate?
You may utilize your patronage in the following ways:
- Pay for your purchases at the register. Simply ask you cashier to apply your rebate.
- Donate to a co-op-affiliated program, such as Growing Food Growing Health School Garden Project or Change For Our Community. Simply fill out a Patronage Donation Voucher with your cashier.
- Via mailed check. Contact Jason Lovell, Finance Manager at email@example.com or 785-843-8544 for additional information on this method.
Patronage credit is not redeemable for cash at the register.
Can you donate your rebate to The Merc Co+op?
The Merc Co+op must pay taxes on unredeemed rebates, so we encourage you to use or donate them to the programs listed above. We appreciate the thought, but using your rebate to shop in the store is the best way to help the co-op and to help yourself.
When can you use your patronage rebate?
You may use your rebate when it is issued in November through the end of March (the following year). After that date, your rebate will no longer be available to you.
How can you find out how many patronage points you have acquired?
Check the bottom of your receipt on your next visit. The number of points is equal to the dollar amount you have spent between July 1 and June 30, in alignment with our fiscal year. Your points are reset each July 1.
Are rebates taxable income to recipients?
Under Internal Revenue Code section 1385 (b) (2), dividends received for purchases made for personal, living or family purposes are exempt from taxable income. If you made purchases for business purposes, however, you might want to consult your tax advisor about whether your allocation should be reported as income or if your expense deduction or property basis should be adjusted.