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Strategies & Market Trends : Dividend investing for retirement
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To: Steve Felix who wrote (5460)8/16/2010 10:57:39 PM
From: LTBH  Read Replies (1) of 34328
 
Don't want this to become a whose right/wrong thing but rather an additional data point for those who might consider holding an MLP/LLC position in an IRA, so the last I'll mention this topic is another real world current hard data example on one you listed ... LINE.

I purchased LINE on 5/6/9 @ 16.41 and my 2009 K-1 tagged me at +15.00 UBTI per 100 units with 18 investors of 27 having UBTI of $14.00 to $53.00 per 100 units. Although this is not a large amount, my point is that LINE did have UBTI and the amount like most MLPs was quite variable as in unpredictable.

In closing the last point I would make and one which could come as a real surprise ... MLPs can and do/have paid no distribution while the K-1 shows UBTI!!! So an IRA could pay taxes WITHOUT an actual distribution.

Check with your CPA but I believe the correct terminology is they can pass through partnership income which translates into UBTI and that this event has nothing to do with/is not linked to whether a distribution is paid.

My goal/hope is that the decision made is informed and associated risks knowingly accepted. I have seen too many posts/links that say don't worry about UBTI, you would need to hold millions before it might become an issue and that comment is just flat wrong.

Luck
LTBH
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