• 5 minutes Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 11 minutes Saudi Fund Wants to Take Tesla Private?
  • 17 minutes Starvation, horror in Venezuela
  • 2 hours WTI @ 67.50, charts show $62.50 next
  • 11 hours Newspaper Editorials Across U.S. Rebuke Trump For Attacks On Press
  • 2 mins Permian already crested the productivity bell curve - downward now to Tier 2 geological locations
  • 54 mins Venezuela set to raise gasoline prices to international levels.
  • 12 hours Mike Shellman's musings on "Cartoon of the Week"
  • 7 hours WTI @ 69.33 headed for $70s - $80s end of August
  • 36 mins The Discount Airline Model Is Coming for Europe’s Railways
  • 16 hours Scottish Battery ‘Breakthrough’ Could Charge Electric Cars In Seconds
  • 1 hour Pakistan: "Heart" Of Terrorism and Global Threat
  • 22 hours Corporations Are Buying More Renewables Than Ever
  • 11 hours Batteries Could Be a Small Dotcom-Style Bubble
  • 23 hours Renewable Energy Could "Effectively Be Free" by 2030
  • 12 hours Don't Expect Too Much: Despite a Soaring Economy, America's Annual Pay Increase Isn't Budging
  • 13 hours France Will Close All Coal Fired Power Stations By 2021

Breaking News:

SEC Tesla Probe Not New: Report

Are Natural Gas Prices About To Break Out?

Are Natural Gas Prices About To Break Out?

Natural gas inventories are low…

What Would A Hard Brexit Mean For British Oil?

What Would A Hard Brexit Mean For British Oil?

Despite nearly 14 months of…

James Burgess

James Burgess

James Burgess studied Business Management at the University of Nottingham. He has worked in property development, chartered surveying, marketing, law, and accounts. He has also…

More Info

Burger King and the Benefits of a MLP

Oil and gas companies are able to take advantage of a great tax break by restructuring themselves to form a Master Limited Partnership (MLP), potentially reducing their tax bill to zero. It works by counting each partner’s profit as the individual’s income, meaning that the MLP becomes exempt from paying corporate tax.

In 2011 Tennessee Gas Pipeline, structured as a normal corporation, paid more than $100 million in taxes; last year it was bought by Kinder Morgan and restructured as a MLP. As a result of the new MLP format, in August it paid no corporate tax.

Pipelineoilandgas.com explains that the “incentives are not ‘Loop Holes’, they were placed in the Tax Code by Congress to make participation in oil and gas ventures one of the best tax advantaged investments.”

Related article: A Fresh Opportunity in Refining Stocks

John Buckley, a tax professor at Georgetown University Law Center and author of the tax code, admitted that they never envisioned “how popular the tax break would become.”

Congress is considering extending the tax break to be available for renewable energy companies as well.

Back in the 1980’s even non-energy companies such as Burger King tried to set themselves up as MLP’s, however congress quickly restricted the tax exception to energy companies.

Maybe if Burger King bought an oil pipeline it could form a MLP.

By. James Burgess of Oilprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News