May a Proposed Expansion of Master Limited Partnerships' (MLPs) Tax Benefits for 'Renewable' Energy Lead to America's Energy Independence?

Mertens - Law of Federal Income Tax - Developments & Highlights, August 2013

10 Pages Posted: 26 Jan 2016

See all articles by William Byrnes

William Byrnes

Texas A&M University School of Law

Robert S. Bloink

HBC Ferguson, PLLC - Attorneys at Law; Thomas Jefferson School of Law

Theron West

Thomas Jefferson School of Law

Date Written: August 2013

Abstract

As of June 2013, Master Limited Partnerships ("MLPs") have reached a market capital of $400 billion, with over 100 MLPs traded on major exchanges. Generally established as LLCs with advantageous partnership flow through tax treatment, MLPs present attractive return vehicles to attract long term capital to the energy extraction, energy transportation ("midstream"), and most recent, energy distribution ("downstream"), markets. However, MLPs may result in unfavorable tax treatment for investors as well.

This Highlight will present the tax issues for MLP investors pre- and post- the 1985 Code, imposed MLP investment restrictions, and gradual relaxation thereof. The Highlight will conclude with an analysis of the April 2013 legislative bi-partisan proposal, the Master Limited Partnership Parity Act, to extend MLP tax treatment to renewable ("green") energy, and why this proposal is contentious.

JEL Classification: H24, K34

Suggested Citation

Byrnes, IV, William H. and Bloink, Robert S. and West, Theron, May a Proposed Expansion of Master Limited Partnerships' (MLPs) Tax Benefits for 'Renewable' Energy Lead to America's Energy Independence? (August 2013). Mertens - Law of Federal Income Tax - Developments & Highlights, August 2013. Available at SSRN: https://ssrn.com/abstract=2722125

William H. Byrnes, IV (Contact Author)

Texas A&M University School of Law ( email )

1515 Commerce St.
Fort Worth, TX Texas 76102
United States
(817) 212-3969 (Phone)

HOME PAGE: http://www.linkedin.com/in/williambyrnes/

Robert S. Bloink

HBC Ferguson, PLLC - Attorneys at Law ( email )

261 E. Maple
Suite 180
Birmingham, MI 48009
United States
(313)417-0423 (Phone)

Thomas Jefferson School of Law ( email )

701 B Street
Suite 110
San Diego, CA 92101
United States

Theron West

Thomas Jefferson School of Law ( email )

701 B Street
Suite 110
San Diego, CA 92101
United States

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