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Brookfield Infrastructure Partners L.P. Message Board

  • ps56k ps56k Mar 20, 2012 12:40 PM Flag

    BIP - yield vs K-1 hassle

    Is the equity growth and current yield worth the hassle of waiting for the K-1 numbers at tax time ?

    Just wondering how each year is with the K-1 and does the reporting time get extended each year.... now till the end of March 2012 ?

    Also - are these K-1 numbers harder to work with vs any other K-1 reporting ?

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    • As I posted on the Smoke & Mirrors thead, my BIP is up 31% in share price, so dealing with the K1 is well worth it. If you are worried about it, put BIP in your IRA and you can just stash the K1s in a drawer, ignoring them but keeping them in case you need to refer to them in the future. I've had a few MLPs in my IRA since the eighties and never had any complications. But I did have to sell OKS because the UBTI was getting close to $1,000 and I would have had to pay a tax on the amount over $1,000 per year. That would have been a very unusual event. Tax advantages make MLPs a better investment for taxable accounts, but occasionally I put one in the IRA because it's the best and safest investment at the moment. There is a possible UBTI tax complication after sale of an MLP from an IRA, but I've never heard of it happening.

      • 1 Reply to genetuck
      • I sold out at nearly 100% gain in just under two years. But, from the recent release "On a per-unit basis, FFO was 60 cents, down from 65 cents in the year-ago period due to an equity issuance in October 2011. Adjusted funds from operations were $80 million, down from 82 million in the second quarter of 2011".

        This is essentially the same excuse given for the under performance last quarter. And, they are issuing new equity again this quarter.

        My guess is that the big equity gains will hold off for a year or two while BIP incorporates these latest acquisitions and equity issuance. That still leaves a nice, and growing, dividend. But, with FFO at 60 cents a quarter and decreasing if they don't show they have made smart, accretive acquisitions soon then this could turn south.

        I continue to watch (and curse my conservative nature) as this continues to climb. But as I find it difficult not to book a double in a nice sound stock like this. Retirement can do that to a person.


    • I bought at $15 so the growth has been alright seems like most companies send out by the middle of march though. The aud is going down but the interest rates in australia are also dropping so that may effect alot of thier assets, good thing to look at

    • I find that I usually get a corrected 1099 the between April 1 and A.pril 10. Thus if I file early I have to file a corrected form. A K1 is not hard to fill out. I use Turbo Tax and go to forms and fill out the K1. I nfind that it is an easy worthwhile job.

    • This is my first year owning it so I don't know the answers to your questions. But it is the last one (out of about a dozen) that I am waiting for.

      However, the capital gains (up about 30%) are nice and the 5% distribution also helps, so i guess patience is virtuous in this case.

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