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Post by notgamblingwithmoney on Dec 5, 2023 0:09:58 GMT
Just wondering what anyone's thoughts are regarding buy stock in MLP's for a Roth IRA account.
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Post by steelpony10 on Dec 5, 2023 0:25:54 GMT
notgamblingwithmoney , I’m no expert, I haven’t held these for years. It’s ok to hold MLP’s in a Roth. UBTI (MLP distributions?), unrelated business taxable income, can be characterized as special income which is taxable. Publication 4012 (2023) is the annual government online tax resource.
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Post by richardsok on Dec 5, 2023 0:42:29 GMT
Just wondering what anyone's thoughts are regarding buy stock in MLP's for a Roth IRA account. If you're considering MLPs in a Roth, you MIGHT want to consider TYG. Distributing 10% quarterly and selling at an enormous 20% discount. Since it's a CEF, you will have no K-1 issues to deal with. According to Schwab, it is fully earning its distributions. (FWIW, I own a position.) Not a recommendation; just a "look-at-this-one". |
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Post by steadyeddy on Dec 5, 2023 1:44:26 GMT
Just wondering what anyone's thoughts are regarding buy stock in MLP's for a Roth IRA account. Your moniker is notgamblingwithmoney but it looks like you are exactly doing the opposite. My 2 cents: stay away from MLPs. link compares AMLP - which is an ETF that holds a bunch of MLPs versus BND (agg bond) versus Wellesley from 2010 to date. Look at the volatility aka Standard Deviation of MLPs. Good luck. |
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Post by retiredat48 on Dec 5, 2023 3:08:09 GMT
notgamblingwithmoney,...Hi. I just posted this on the Fido Forum: @_______ ...OK, so I googled same. It appears some articles state that owning individual MLPs in an IRA can be considered all UBTI...or Unrelated Business Taxable Income, with a $1000 limit. My understanding of UNRELATED BTI is different from theirs. However, Since I don't own individual MLPs I won't delve further. In my IRAs I owned ETFs, or C-Corporation structured MLP Investments holding several MLPs. The very same article states: "For investors that want MLP exposure in their retirement accounts but do not want to worry about UBTI, investment products can help. Exchange-traded funds (ETFs) that predominantly own MLPs can provide diversified exposure to MLPs and will not generate UBTI because they are structured as C-Corporations. A partnership can generate UBTI, but an ETF does not. To repeat, investors that own MLP ETFs in tax-exempt retirement accounts do NOT have to worry about UBTI triggering UBIT."
This is what I own. Never got a K-1 or tax bill from Fidelity. R48
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Post by liftlock on Dec 5, 2023 3:55:03 GMT
Just wondering what anyone's thoughts are regarding buy stock in MLP's for a Roth IRA account. Your moniker is notgamblingwithmoney but it looks like you are exactly doing the opposite. My 2 cents: stay away from MLPs. link compares AMLP - which is an ETF that holds a bunch of MLPs versus BND (agg bond) versus Wellesley from 2010 to date. Look at the volatility aka Standard Deviation of MLPs. Good luck. It depends on the analysis time frame. The slope of the trend lines suggests AMLP is outperforming BND and Wellseley since early 2000. |
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Post by steadyeddy on Dec 5, 2023 12:36:40 GMT
Your moniker is notgamblingwithmoney but it looks like you are exactly doing the opposite. My 2 cents: stay away from MLPs. link compares AMLP - which is an ETF that holds a bunch of MLPs versus BND (agg bond) versus Wellesley from 2010 to date. Look at the volatility aka Standard Deviation of MLPs. Good luck. It depends on the analysis time frame. The slope of the trend lines suggests AMLP is outperforming BND and Wellseley since early 2000. But that doesn't change the volatility/SD of AMLP relative to BND and Wellesley. Could AMLP produce great returns? possibly but history is not suggesting that. |
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Post by mnfish on Dec 5, 2023 12:42:24 GMT
MLPs are designed as a tax advantaged investment. No need for a Roth, IMO.
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Post by notgamblingwithmoney on Dec 5, 2023 23:11:26 GMT
notgamblingwithmoney , I’m no expert, I haven’t held these for years. It’s ok to hold MLP’s in a Roth. UBTI (MLP distributions?), unrelated business taxable income, can be characterized as special income which is taxable. Publication 4012 (2023) is the annual government online tax resource. I forgot UBTI's. I'm not looking for complications at tax time. |
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Post by notgamblingwithmoney on Dec 5, 2023 23:12:09 GMT
Just wondering what anyone's thoughts are regarding buy stock in MLP's for a Roth IRA account. If you're considering MLPs in a Roth, you MIGHT want to consider TYG. Distributing 10% quarterly and selling at an enormous 20% discount. Since it's a CEF, you will have no K-1 issues to deal with. According to Schwab, it is fully earning its distributions. (FWIW, I own a position.) Not a recommendation; just a "look-at-this-one". I looked, thanks |
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Post by notgamblingwithmoney on Dec 5, 2023 23:14:03 GMT
thanks all for your thoughts, It was just a question, not looking to complicate my tax situation.
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Post by retiredat48 on Dec 6, 2023 5:31:40 GMT
MLPs are designed as a tax advantaged investment. No need for a Roth, IMO. What if all of ones assets are in Trad or Roth IRAs? I have no meaningful taxable account monies. r48 |
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Post by mnfish on Dec 6, 2023 11:37:33 GMT
IMO, it makes far more sense to have growth stock/MF, ETF or in a Roth vs a MLP.
As far as UBTI is concerned, I've owned MMP and EPD (and others) in a taxable acct since 2014 and most years it's negative.
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Post by Capital on Dec 6, 2023 12:27:52 GMT
thanks all for your thoughts, It was just a question, not looking to complicate my tax situation. IMHO if you do not want to complicate your tax situation you would best be served by staying away from MLPs in both IRA and Taxable accounts. As stated, that is just MHO. My rule for myself is that I do not invest in anything that distributes a K-1 at or somewhere in the approximate vicinity of year end to me. |
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Post by retiredat48 on Dec 6, 2023 18:02:48 GMT
thanks all for your thoughts, It was just a question, not looking to complicate my tax situation. IMHO if you do not want to complicate your tax situation you would best be served by staying away from MLPs in both IRA and Taxable accounts. As stated, that is just MHO. My rule for myself is that I do not invest in anything that distributes a K-1 at or somewhere in the approximate vicinity of year end to me. OK... I am the same way. No K-1s for me, or UBTI. Be see my post above. Investing in IRAs using ETF or C-corp wrapper results in no K-1s...and UBTI is just a fraction of any holding. So investments less than $100,000 should never have UBTI. I have owned in IRAs for over a decade, without ever having a K-1 or UBTI. R48 |
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Post by Capital on Dec 6, 2023 18:27:39 GMT
IMHO if you do not want to complicate your tax situation you would best be served by staying away from MLPs in both IRA and Taxable accounts. As stated, that is just MHO. My rule for myself is that I do not invest in anything that distributes a K-1 at or somewhere in the approximate vicinity of year end to me. OK... I am the same way. No K-1s for me, or UBTI. Be see my post above. Investing in IRAs using ETF or C-corp wrapper results in no K-1s...and UBTI is just a fraction of any holding. So investments less than $100,000 should never have UBTI. I have owned in IRAs for over a decade, without ever having a K-1 or UBTI. R48 , I see what you are saying. I just have so many other options for investing that I do not need MLPs or their potential tax problems. Not saying that you are wrong for you. Just saying I am right for me. |
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Post by retiredat48 on Dec 6, 2023 19:04:55 GMT
Capital ,...BTW I own zero MLP Funds, currently! R48 |
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Post by Schroeder on Dec 7, 2023 15:14:32 GMT
I can advise you from my experience they do complicate your taxes and if you in an IRA it would do even more. If you own them you are subject to involuntary sales or mergers by the general partner. I have had them with OKS, SEP and MMP. Then you have to account for that on your tax return. Generally, my other equity investments have had a higher total return than my MLPs over the years I owned them.
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