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Linn Energy, LLC (LINE) Message Board

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  • teva4eva teva4eva Feb 17, 2011 7:10 PM Flag

    The way to make money in LINE

    Joel
    I am a player in other areas of the mkt but have wanted to get into MLP's for a long time.The question is whether to buy in my personal or IRA account and this depends on how the distributions are treated tax-wise. Would you please enlighten me on this point. Any guidance would be most appreciated. TKS Stan

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    • In general tax-wise it is better to buy outside the IRA. If your UBTI is less than $1000 then you are safe in a IRA. I would recommend first to check out a MLP primer before purching MLP units and have a basic understanding of K1's. There is plenty of information on this board and plenty of people to ask. Expect to see plenty of these posts as April approaches.

      hflippo

    • In general tax-wise it is better to buy outside the IRA. If your UBTI is less than $1000 then you are safe in a IRA. I would recommend first to check out a MLP primer before purching MLP units and have a basic understanding of K1's. There is plenty of information on this board and plenty of people to ask. Expect to see plenty of these posts as April approaches.

      hflippo

      • 1 Reply to hflippo
      • "In general tax-wise it is better to buy outside the IRA." And my take is diametrically opposed. With 8000 units of LINE in two IRA's neither my wife nor I has ever paid (or come close to needing to pay)UBIT. Also, Linn had already stated that their UBTI will be minimal. Now if you plan on, say, more than 10,000 units in an account, you might possibly have to pay some, but so what. In an IRA there are no K-1 complexities, which actually are more extensive than Turbotax can handle, and you needn't be concerned about a rapid diminution of cost basis (which some less sophisticated holders falsely think is limited to distributions). There's an excess of alarmist commentary on the Web about UBTI in IRA's. Finally, I've held various MLP's in IRA's for more than 6 years(though solely in LINE now)without paying a cent in UBIT.

 
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