“Managing’ UBTI in a Roth
I OWN MULTIPLE MLP’S IN A ROTH IRA. FROM YEAR ONE I HAVE RECORDS OF ANNUAL UBTI IN EACH.
BEFORE BUYING I CONTACT THE THE MANAGEMENT TO DETERMINE WHETHER ANY UBTI IS POSITIVE OR NEGATIVE HISTORICALLY.
I HAVE NEVER BOUGHT ONE WHERE IT APPEARS THERE WILL BE OVER $1000 POSITIVE IN ANY INDIVIDUAL MLP AND THUS FAR MY RECORDS FROM DAY ONE HAVE ACCUMULATED NEGATIVE UBTI IN EACH, SOME SIZABLE.
QUESTION- IF I SELL (ANY) ONE WITH ACCUMULATED NEGATIVE UBTI, DO i HAVE TO FILE A 990?.
OBVIOUSLY THIS IS MAY BE EASILY BE THE MOST MISUNDERSTOOD IRS GRAY AREA THAT EXISTS.
WOULD APPRECIATE RESPONSES FROM PEOPLE/PROFESSIONALS WHO HAVE BEEN THERE..
Permalink Submitted by Alan Spross on Tue, 2012-06-12 01:15
There are plenty of gray areas, the largest of which is applying the 1,000 over all IRA accounts or PER IRA account.
I wouldn’t file a 990 for a negative UBTI. All that would do is result in the cost of preparing the 990 being taken out of your Roth IRA.