Treasury Department to monitor MLPs, but mostly looks like jawboning

|By:, SA News Editor

In the wake of Kinder Morgan‘s absorption of its MLP subsidiaries, the Treasury Department has decided to look into the rise in MLP-related transactions and their effects on future tax revenues.

Daniel Clifton of Strategas Research is not impressed, citing Treasury’s recent "regulatory jawboning” about tax inversions and saying the agency has similarly flimsy regulatory authority over MLPs.

The IRS has been reviewing the MLP approval process since April after going through a similar review process for REITs in 2013 and concluding the approvals were in line with the law, and the same results were expected for MLPs; timed with the Kinder Morgan news, Strategas thinks Treasury is engaging in an "attempt to jawbone companies in the future from seeking MLP approvals."

ETFs: AMLP, AMJ, MLPL, YMLP, MLPI, MLPA, ENY, MLPN, MLPG, EMLP, MLPS, MLPX, MLPY, MLPJ, AMU, YMLI, ATMP, ZMLP, MLPW, IMLP, ENFR, MLPC