Although master limited partnerships (or MLPs) have been around for more than 25 years, they have received increased attention in the news and become a more significant portion of our economy as the United States develops its domestic energy industry. MLPs are publicly traded limited partnerships that are engaged in certain energy-related activities. The public can buy and sell common units representing limited partner interests on a national stock exchange the same way they buy and sell common stock in a corporation.

The key difference between an MLP and a corporation is that the MLP does not pay entity level taxation. An MLP is an attractive vehicle for energy companies because they can conduct activities and invest in growth projects at a lower cost of capital and higher valuation, while retaining full control of the business.

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