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Author: PsychoDr Three stars, 500 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76237  
Subject: Question regarding MLP's Date: 12/22/2008 11:10 AM
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Hi all: I have a question about Master Limited Partnerships and their tax deferred status. I have read that they are not a good purchase in a retirement account because placement in the retirement account might impact their tax deferral status. However, I am not certain how.

I specifically wonder if their tax deferral status would be jeopardized if they were purchased in a ROTH, since all capital gains are tax free. It would seem that there would be no tax advantage loss if the MLP was placed in a ROTH. I am looking at ETP as an example of a master limited partnership.

I was thinking that a stock with a large dividend payout would be a good purchase in a ROTH for a long term investment, but ran across the comment in a seeking alpha article which indicated that this should not go in a retirement account. Any thoughts?

Thanks, Psycho
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Author: BruceCM Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 64901 of 76237
Subject: Re: Question regarding MLP's Date: 12/22/2008 12:03 PM
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The topic of MLP's was just recently discussed

http://boards.fool.com/Message.asp?mid=27289330

The risk of UBTI is the same with a Roth as it is with a traditional IRA, qualified retirement plan or charitable remainder trust.

If you're looking for a high dividend paying stock today, I'd take a look at REIT preferreds. But most would advise against holding MLP's in a tax deferred account.

BruceM

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