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Patronage distribution

A patronage distribution is net income allocated to patron members above dividends and reserve additions, which chapter 308B requires to be distributed on the basis of patronage.

Verified against sources: October 15, 2026Last edited: October 15, 2026

Under the statute, net income allocated to patron members in excess of dividends on equity and additions to reserves "shall be distributed to patron members on the basis of patronage" § 308B.725, subd. 3 P1. Distribution is made at least annually, and the board reports to the members at the annual meeting § 308B.725, subd. 4 P1.

Forms#

The cooperative may pay in cash, capital credits, allocated patronage equities, revolving fund certificates, or its own or other securities § 308B.725, subd. 5 P1. The statute uses those words without defining them. For the federal tax definition of a patronage dividend see Patronage dividend. See Allocate patronage and make distributions.

Statute sections referenced

  • § 308B.725 ALLOCATIONS AND DISTRIBUTIONS TO PATRON MEMBERS.

Sources

  • P1 Minnesota Statutes, Chapter 308B (Cooperative Associations), Office of the Revisor of Statutes, State of Minnesota. revisor.mn.gov (primary; accessed October 15, 2026)

glossary

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