Craft Pod uses a collect-and-reinvest strategy to keep the portfolio diversified while deferring taxes wherever possible. This directly supports the Pod’s core objectives.
Dividends and other investment income
When a company whose shares are held in the Pod pays a dividend — or when the Pod earns charter revenue or interest — that cash is recorded as income of the fund. The Manager typically reinvests this income into additional securities or holds it briefly for liquidity needs rather than distributing it to investors right away.
This approach helps keep the Pod above the 20% threshold of marketable assets required for Section 721 treatment. If the Pod ends up with more cash than it needs, the Manager can declare a distribution, but the standard practice is to keep earnings working inside the Pod.
Capital gains
If the Pod does need to sell shares that carry a built-in gain, Section 704(c) rules apply: the gain is specifically allocated back to the investor who originally contributed those shares. This ensures other members aren’t taxed on appreciation that never belonged to them.
Tax reporting
Every year, participants receive annual tax documents (Schedule K-1) showing the relevant details for tax filing.
Please read our full disclosures before making an investment decision.