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Capital Credit FAQs

What are 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.
Where does the money come from?
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.”
What’s the difference between allocated and retired capital credits?
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.
Are capital credits retired every year?
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.
How are the capital credits be returned to eligible 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.
Why does it take so long for capital credits to be returned?
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.
What do I have to do to start accumulating capital credits?
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.
Can capital credits be applied toward my electric bill?
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.
Can I donate my refund to Tipmont’s community programs?
Yes. Tipmont has two community programs, Operation Round Up and EnviroWatts. Both programs are 501c3 trusts, so the donations would be tax deductible. Please contact Tipmont Member Services at (800) 726-3953 or visit tipmont.org for more information.
Can a relative claim my capital credits if I die before they are retired?
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.
I received a check in the mail, but it's in the name of a former resident. What should I do?
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.
How long do members have to cash their checks?
Capital credit checks must be cashed within 180 days (six months).
What happens to my capital credits if I move out of the Tipmont’s service area?
The capital credits you earned during your membership will be sent to eligible members as it is retired. It is the member’s or beneficiary’s responsibility to keep the cooperative informed of address changes.  If the check is returned (bad address) or not cashed within six months (180 days), your name will be listed in the Unclaimed Capital Credit Search. If, sixty (60) days after the announced retirement, such checks remain unclaimed or uncashed, the retirement funds shall be transferred by Tipmont to an appropriate sub account. The unclaimed funds will then be assigned to the other patrons of Tipmont. 
Do unclaimed capital credits accrue interest?
According to Tipmont REMC’s bylaws, no interest shall accrue on these unclaimed funds.
Will I receive a capital credits check every year?
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.
Are capital credits tax free?
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.




  • P.O. Box 20
  • 403 S. Main St. MAP
  • Linden, IN 47955
  • (800) 726-3953
  • (765) 339-3243
  • Monday - Friday
  • 8 a.m. - 4:30 p.m.
  • Email us Chat Bug
Empowering Our Communities

Tipmont REMC's mission, adopted in late 2014, is to empower our communities with state-of-the-art essential services. MORE