A Master Limited Partnership , or MLP, is a limited partnership whose equity interests (known as “units” as opposed to “shares”) are traded on public stock exchanges. MLPs are considered a form of “pass-through” entity and are not subject to federal income taxation at the partnership level. The MLP’s income is passed through to its partners proportionately in accordance with their ownership interests in the partnership. Each partner is then responsible for paying tax on his or her share of their allocable income. For more information, please visit the Energy Infrastructure Council (EIC) website: eic.energy/mlp-101-the-basics/
MLPs generally make cash distributions to their partners, usually on a quarterly basis. Each MLP is governed by the provisions within their Limited Partnership Agreement that specifies the manner in which cash distributions will be made to its general and limited partners. DMLP cash distributions are required to be paid within 45 days after the end of each quarter.
For a history of DMLP’s cash distribution payments, please see our Cash Distribution History.
Partnership distributions are generally considered return of capital and will not result in taxable income or gain to its investors unless, and only to the extent that, the distribution exceeds the investor’s adjusted tax basis in its units immediately before the distribution.
As a partner in a limited partnership, you are allocated your proportionate share of the partnership’s taxable income, which is reported to investors annually on Schedule K-1. Investors in MLPs receive a Schedule K-1 instead of a Form 1099. The information provided on your Schedule K-1 will be needed to prepare your annual income tax return.
DMLP investors can normally expect to receive their Schedule K-1 to be available online at https://taxpackagesupport.com/dmlp by early March and received in the mail by the middle of March.
A limited number of investors (primarily those who are foreign, investors computing a foreign tax credit on their income tax return and certain corporate and/or partnership investors) may need the detailed information disclosed on Schedule K-3 for their specific reporting requirements. Investors may access Schedule K-3 online at https://www.taxpackagesupport.com/usac on or before the end of August.