Matt Badiali was busy as a professor of geology at the University of North Carolina whenever he received a phone call from one of the world’s leading experts in the financial industry. This individual offered Matt Badiali a chance to serve as part of a team of his was working on a project involving investment in the natural resource markets. This individual realized that he would need a trained scientist in order to make the best investment decisions in the natural resource markets. Matt Badiali jumped on the opportunity and was soon part of a project that allowed him to travel the world reading with the leading figures in the natural resource markets. It was during part of his research on a project in the natural gas and oil industries that he came to be aware of the existence of Master Limited Partnerships. Read this article at Money Morning.
A Master Limited Partnership is a particular type of classification for a corporation. This classification was invented by Congress in the 1980s as a result of a piece of legislation which is known as Statute 26-F. Statute 26-F allowed corporations to qualify to operate tax-free if they met certain requirements. Corporations must generate 90% of their income from the processing, distribution, transportation, and development of oil and natural gas domestically within the borders of the United States of America. These corporations must then pay out a portion of these revenues to its investors in a way that is incredibly similar to dividends in the traditional stock market. It is this distribution of income that Matt Badiali is referring to whenever he speaks of Freedom Checks.
Matt Badiali coined the term Freedom Checks because the legislation was developed as a way to help incentivize corporations to begin work that would lead to America’s freedom from other countries energy exports. By investing in Master Limited Partnership’s, you will get Freedom Checks on either a monthly or quarterly basis. Any income that is generated from these Freedom Checks is considered a return of capital. As a return of capital, you are only subject to the lower rate of tax known as capital gains tax. Capital gains tax is much lower than personal income tax. Additionally, if an individual were to sell their shares in a Master Limited Partnership, this also would only be subject to capital gains tax. As a result of these findings, Matt Badiali realized that these were an incredible opportunity for investors who wish to invest in the energy independence of America and their own financial future simultaneously.