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Subject:  Re: UBIT Date:  12/6/2017  6:41 PM
Author:  buyandwin Number:  96 of 111

Hi Itch:

>>>> My question is , if I invest $20,000.00 or less in an MLP within my IRA, is there any way of knowing if that invested sum would exceed the $1000.00 allowed amount of UBIT and thus trigger the requirement to file and pay tax ? Hope I made sense. Thanks, itch<<<<

There is no way of knowing what the UBIT will be until you receive the the K-1 in March of the following year.

You have to remember that an MLP is a tax sheltered investment and doesn't belong in an IRA or ROTH which are tax sheltered portfolios. The benefits of investing in tax shelters is to have a tax shelter. Many of the benefits of an MLP investment are lost by investing in a sheltered account (IRA-ROTH) Losing the benefits of the sheltering makes the investment less or unattractive. In fact profits in MLP sales in an IRA trigger UBIT income. Before you do anything I would suggest you read a Good MLP primer. There are a number of them listed on google. Pick the one with the most pages, because it will have more detail.
Good luck
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