MLP's pay good yields because unlike corporations, they pay no income taxes. The whole cash stream goes to you as a partner and you are supposed to pay income taxes on it. Yes, that includes potential state taxes in every state. That is usually an issue with them mentioned in the fine print. I have never owned a pipeline with operations in many states, but I have never received a tax bill from a state.Another potential liability. Don't hold the units too long.These are high risk investments, good for income for a while, but not a good place for the rent money. They can be OK as part of a diversified portfolio.
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