Any foreign investors considering EEP, please remember it is a MLP partnership and the US will put a withholding tax of 40% on distributions. A better choice for a foreign investor is EEQ, which is a corporate form of EEP whose shares own some of EEP. EEQ pays out distributions in like kind, so more shares of EEQ. That avoids any tax until the time of sale, of course your tax law may differ.

Please also remember that in the 2009 market crash that hedge funds were forced to liquidate MLPs, because they had been putting available cash balances in those because of their high effective interest rates. As a result, this market IMPLODED in 2009 when hedge funds became forced sellers. That is the risk in buying these today, but this is also the opportunity and it would be well worth putting these on your watchlist.

Unlock the rest of this article with a 14 day trial

Unlock with Email
Unlock with Google

Already have an account?
Login here