What is a master limited partnership (MLP)?
An MLP is a publicly traded partnership. The nature of a partnership provides for the “pass through” of income to its partners. This essentially avoids double taxation on profits often paid by corporations, which pay corporate income tax in addition to its shareholders paying taxes on dividends. Individual investors buy ownership interests, or units, in the partnership similar to purchasing shares of stock in a corporation.
A master limited partnership, or MLP, is a limited partnership. Units that are traded on public stock exchanges represent the investor’s limited partner ownership interest in the MLP and the investor is called a unitholder. In addition to the limited partners, which provide capital to the partnership but have no role in its management, an MLP has one or more general partners that manage the partnership. BBEP’s general partner is BreitBurn GP, LLC.
