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Author: aj485 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121585  
Subject: Re: MLPs in IRAs Date: 8/9/2010 9:35 AM
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I'm very close to retiring a bit before age 58 and will use a large chunk of my cash from taxable accounts to bridge me to 59 1/2...and have been planning on letting the IRA balances grow in the interim until I'm ready to withdraw.

Do you have a 401(k) with your current company? Retiring (ending service with your company) in or after the year you turn 55 would allow you to withdraw money from your 401(k) without penalty or having to take 72(t)/SEPP withdrawals. Assuming that you don't have your 401(k) invested in MLPs, you could use that the bridge to 59 1/2 without disturbing MLP investments in either your IRA or your taxable accounts.

If your 401(k) plan allows, you could even move some of your IRA money into your 401(k), if your current 401(k) balance isn't high enough for that bridge.

Personally, with the tax laws likely to be changing and the requirement for the IRA to have to file it's own tax return for UBTI > $1000, I would be cautious about investing a significant amount of an IRA into MLPs - the cost of getting the IRA to file the tax return alone (not really a DIY thing) has the potential to offset any advantages.

AJ
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