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CVR Partners, LP Message Board

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  • irbbping irbbping Jun 16, 2011 4:45 PM Flag

    Since UAN is an LP does anyone know if you will hve to file additional IRS tax forms

    this is a part of an article by elliott Gue on the internet, i met you on the WHX thread and you seem very knowledgeable on this stuff, do you think his comments are in error ? thanks

    To qualify as MLPs, companies must generate at least 90 percent from the type of income that’s exempt from UBTI. The upshot: Only investors who garner more than $10,000 in income from a single MLP are at any risk to being assessed UBTI taxes in an IRA.

    Moreover, energy producer MLPs often generate UBTI, while energy infrastructure MLPs often create “negative” UBTI. As a result, even if an investor has a significant UBTI liability with one MLP, he or she can offset it with negative UBTI at another MLP.

    The bottom line is that for all but a small handful of investors, the UBTI issue is really much ado about nothing. And if the MLP is held within an IRA, the IRA is the unitholder and therefore the taxpayer. That means the investor doesn’t file a Form K-1. Rather, the custodian is responsible for filing an IRA Form 990T. Thus, even this complication is eliminated.

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