You don't want to own Linn Energy within an investment club. Linn is treated as a partnership for tax purposes. It issues a K-1 which you will have to manually transcribe to your club's 1065 as well as manually allocate the various items of income and expense to your members. Additionally, as an operating partnership, your investment in Linn could expose the club and each of its members to having to file state tax returns in each of the 10 states where Linn has operations.

 

Ira Smilovitz

 

Thanks Ira.  We are looking at Linn Energy (LINE)

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From: "IraS1@aol.com" <IraS1@aol.com>
To: club_cafe@bivio.com
Sent: Wed, June 13, 2012 9:24:17 AM
Subject: Re: [club_cafe] Re: [LLC's

LLCs are state-created entities. Therefore, there is no specific tax treatment for an LLC - it could be treated as a corporation, a partnership, or a disregarded entity. Without knowing the specific potential investment, you can't get a definitive answer.

 

Ira Smilovitz

 

In a message dated 6/13/2012 10:16:40 A.M. Eastern Daylight Time, jaynegrd@sbcglobal.net writes:

Our club is interested in purchasing a LLC.  Does bivio handle LLC's or is it better to steer away.  I know you don't recommend MLP's for clubs due to the accounting problems.