My apologies if I've missed any threads on this one.
While certainty is not yet certain, what is likely to be the impact of the expiration of the Bush tax cuts on taxable distributions like LINE's, assuming that there is not a favorable outcome for shareholders of MLPs?
If you enjoy doing this by yourself, this may be a place to start----http://taxes.suite101.com/article.cfm/best_free_tax_accounting_software_review--Until this asset class becomes larger and more well known--the tax advantages should continue IMO--GL2U
Here's the deal: Owning shares of the limited partnership, you are essentially getting the same tax treatment as big oil and gas exploration companies get. Obama hates oil and gas and loves other energy sources. He would like to curtail the tax benefits of oil and gas explortation and develpment. If he had his way, the taxes on distributions would be changed considerably. We'll see if that happens. Those of us in the oil and gas business are hoping he'll be out of there in 2012, of course. We'll see.
Unless you're a psychic, you're simply making this up. Obama has stated he wants more clean energy and a reduction of foreign oil dependence. The latter requires heavy domestic oil production. He's not about to kill the goose and screw up golden egg production. Of course, if you feast on tea party bombast and the hyper-drama of talk radio, you'll think I'm probably a naif in a red cloak making friends with woodland wolves. But I'm with Limbaugh. I'd like to see the end of socialism in this country, too: no more Medicare, no more federal interstate highways, no more agricultural subsidies, no more FDA regulating pharmas, no more Medicaid, no more federal health care for military retirees, etc., etc.
Distributions are not taxable, as they are considered a return on investment. However, when you sell, all distributions previously earned will be taxed as ordinary income. The Bush tax cuts had no impact on distributions.
Distributions are not necessarily taxed as ordinary income upon sale. A portion of your gain may be taxed as ordinary income resulting from recapture of depletion, depreciation, and IDCs. The amount or percentage is impossible to predict
The distributions are not directly taxed but subtract from unit purchase cost. Thus, when units are sold (a matter for capital gains/losses), the unit cost basis has been reduced by the distributions paid on them.