The domestic oil and natural gas industry of the United States of America has grown significantly over the past several decades. This is due in part to legislation that was passed in the 1980s by Congress in order to incentivize the development of these industries. This legislation created a new tax classification that could be bestowed upon corporations which operated within the oil and natural gas industries in the United States of America. If a corporation was able to meet the requirements set forth by the new legislation their tax liability was eliminated entirely. This allowed corporations to generate significantly more revenue due to paying zero dollars on tax.
The legislation in question is known as Statute 26-F. Statute 26-F created the tax classification which is known as master limited partnerships. A master limited partnership is a corporation which generates 90% of its revenue from activities in the oil and natural gas industries. These activities include the production, processing, storage, and transportation of oil and natural gas domestically within the borders of the United States of America. Additionally, a master limited partnership is required to pay out a portion of its revenue to its investors on a regular basis. These payouts were popularized as an investment opportunity by Matt Badiali, the natural resource expert for Banyan Hill Publishing Company, as Freedom Checks. Read more at Agora News about Freedom Checks.
Anytime that you hear of a unique investment that promises significant returns it is common to remain skeptical until you receive further information. Freedom Checks do represent a real investment opportunity. In fact, for the investor who is worried about their tax obligations at the end of the year, they could be one of the greatest investments you can make. Matt Badiali has stated that there are 568 companies in the United States of America that qualify to operate as a master limited partnership.
The reason why these investments represent such a great opportunity for the investor who is worried about their tax obligations is due to the fact that the income he received from these investments is treated as a return of capital. Income which is treated as a return of capital is only subject to capital gains tax. Capital gains taxes much lower than personal income tax. In comparison to dividends which are received through investment in the stock market Freedom Checks are a much better opportunity if you wish to limit your overall tax obligations at the end of the year.