Prorate Billable Value for Billing Allocation

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There may be a case where you add a new account to an existing billing group partway through a period. This billing setting allows you to change the amount charged to the new account based on how long it was in the billing group, rather than charging it as if it belonged to the billing group for the entire billing period.

You must set the billing inception date when adding accounts to an existing billing group.

Notes on Calculation

Using this setting does not reduce the total fee. Instead, it moves some of the fee from the new account to existing accounts.

When using average daily balance, Tamarac calculates the average daily balance for all the days from the billing group inception date to the end of the period. It then applies the rate tier to that value. Finally, the bill is prorated for the portion of the period the new account was included in the group.

See Prorate Billable Value for Billing Allocation in Action

The Abbey Family billing group contains two accounts:

Georgia Abbey IRA
Michael abbey IRA

Cherry Street Financial has managed these accounts for years, and the Abbey Family billing group has been billed accordingly.

Now, the Abbeys transfer their brokerage account to Cherry Street Financial halfway through the billing period, and the brokerage account already has value when it's added to the Abbey Family billing group. Now the Abbey Family billing group contains three accounts:

Georgia Abbey IRA
Michael abbey IRA
Georgia and Michael Abbey Brokerage Account

Prorate Billable Value for Billing Allocation Cleared	Prorate Billable Value for Billing Allocation Selected
With this check box cleared, all three accounts are billed as if all three were in the billing group for the entire period. For example, if the total bill is $100, each account will be billed 1/3 of the total amount, or $33.33.	With this check box selected, the IRAs will be billed based on the whole period, while the brokerage account will be billed based on half the period. For example, if the total bill is $100, the IRAs will be billed for the full period, while the brokerage is billed for 1/2 the period. Thus, the IRAs will be billed $40 each and the brokerage account will be billed $20.

Prorate Billable Value for Billing Allocation Cleared

Prorate Billable Value for Billing Allocation Selected

With this check box cleared, all three accounts are billed as if all three were in the billing group for the entire period.

For example, if the total bill is $100, each account will be billed 1/3 of the total amount, or $33.33.

With this check box selected, the IRAs will be billed based on the whole period, while the brokerage account will be billed based on half the period.

For example, if the total bill is $100, the IRAs will be billed for the full period, while the brokerage is billed for 1/2 the period. Thus, the IRAs will be billed $40 each and the brokerage account will be billed $20.

Learn More

For more information on billing groups, see Understanding Billing Groups.

For more information on billing definitions, see Understanding Billing Definitions.