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Frequently Asked Questions: About Capital Credits

What are capital credits?

A cooperative does not earn profits in the sense that other businesses do. Instead, any margins, or revenues remaining after all expenses have been paid, are returned to the members in proportion to their usage of the co-op’s services through capital credits allocations and retirements. Capital credits represent each member’s share of the cooperative’s margins and ownership of the co-op.

How does the cooperative determine who receives capital credits?

Capital credits are allocated to each member of the cooperative every year based on participation in the cooperative. The board of directors determines the basis for the allocation. The allocations are based on the total dollar amount of services purchased.

Are Capital Credits only retired to deceased members ?

Not necessarily. The cooperative has established a retirement cycle, approximately 25 years, for the retirement of capital credits. 
In addition to the normal retirement cycle, capital credits of a deceased member are paid to the member’s estate.

What happens to a member's capital credits if the member dies?

Capital credits in the member’s account belong to the member’s estate. In order to assist the member’s heirs in closing the estate, the co-op offers a special capital credits retirement of the outstanding balance of the deceased member’s capital credits account, at a discount.

What happens to a member's capital credits if the member moves away from the system?

A member who terminates service no longer receives additional capital credits allocations. The balance in the member’s capital credits account is maintained until it is retired in full.
It is the member’s responsibility to notify the co-op of any changes in address so that the member can be located when it is time for the co-op to retire capital credits allocated to the member’s account.

Does the member have to report capital credits on tax returns?

Capital credits are a return of money paid for electricity in a previous year and are generally not taxable income for residential consumers. Commercial and industrial consumers should discuss any capital credits retirements with their tax advisers.

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Waynesville Physical Address

376 Grindstone Road
Waynesville, NC 28785
(828) 452-2281 or (800) 951-6088
(828) 926-4290 Fax

Lake Toxaway Physical Address

298 Blue Ridge Road
Lake Toxaway, NC 28747
(828) 966-4215
(828) 883-3874 Fax

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©2021 Haywood EMC. All Rights Reserved.

  • About Us
    • About Touchstone Energy
    • Board of Directors
    • Management Team
    • Employment
    • Cooperative Principles
      • Cooperative Difference Video
    • Service Territory Map
    • Together We Save
  • Member Services
    • Application for Electric Service
    • Capital Credits
      • Frequently Asked Questions
      • Estate Retirements
    • Project HEMC
    • Service Rules & Regulations
    • Staking Department
    • Co-op Connections
    • Rate Schedules
      • Time Of Day Rates
    • Safety
      • Storm Preparedness
      • Safety Quiz
    • Billing Information
      • Easy Ways to Pay
      • How To Read Your Bill
      • Delinquent Bill Timeline
    • Forms
      • Service Order Form
        • Tree Trimming
      • Medical Condition And Equipment Form
    • HOPE Program
    • Smart Meter Energy Usage Data Privacy/Security Advisory
    • Text Outage Alerts
    • Title VI Statement of Non-discrimination
  • Products
    • Electrician List
    • Generlink
    • HomeServe Protection Plans
    • Surge Protection Program
    • Generators
      • Generator Loan
      • Generator Service Agreement
    • Heat Pumps
      • Licensed HVAC Contractors
      • Heat Pump/Weatherization Loan
    • Security Lighting
  • Your Community
    • Bright Ideas Grants
    • Carolina Country Magazine
    • TSE Sports Camp Scholarship
      • Boys Basketball Camp
      • Girls Basketball Camp
    • News
    • TSE Scholarship
    • Youth Tour Application
  • Energy Efficiency
    • Electric Vehicles
    • Whole House Energy Audit
    • CFL Disposal
    • NC GreenPower
    • Together We Save
    • Home Energy Adventure
    • Energy Star Home Advisor
  • Renewable Energy
    • RGR Rate
    • RGS Rate
    • Certificate Of Completion
    • Contracts With Haywood EMC
    • General Information
    • Interconnect Application
    • Photovoltaic Site Assesment
    • Renewable Energy Sources
    • Typical Components Of A Photovoltaic Interconnected System
    • Water Turbine Site Assessment
    • Wind Turbine Site Assessment
    • Interconnection With Haywood EMC