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Subject:  Re: MLP merger Date:  6/11/2013  11:36 PM
Author:  Wradical Number:  118671 of 128043

Two MLPs, Crestwood Midstream LLC (CMLP) and Inergy LP (NRGY) are considering a merger.

The messy multiple events to complete the deal are covered on Page 3 & 4--
Besides the larger operational entity potentially adding more states to the mix (and therefore,
potentially, more state tax filings), are there any additional tax gotchas with an event like

Maybe not. Mergers of MLPs, like mergers of corporations, can be, and usually are structured to be tax-free reorgs., but not always.

The deal isn't going to finally close until the 3rd quarter. In the meantime they're working on the regulatory clearances, one of which will be a private letter ruling from the IRS that it will be a tax-free deal. And if not, they'll get the wrinkles spelled out, so they can make it work, and probably will.

There's going to be a cash distribution of $1.03/share, which may be taxable, depending on your basis in the partnership.

How many states do you file in now? Yes, it will be a bigger entity, but your individual piece may not be any bigger. The resulting shares' income in the various states might not be any larger, either. We try to, and get clients to use a little common sense when it comes to "How low do you go?" when deciding to file in a particular set of states.

We've only had a couple of states ever come after people for what I though were little amounts of income from an MLP, and those were Oklahoma and Louisiana - but those are big states in the energy business.

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