Tapping into the Profitable Oil Industry
The oil industry has seen some huge improvements ever since supply of foreign oil has been steadily replaced by domestic. And now with the less restrictions coming to fracking one can only expect to see even more economic growth regarding oil and gas. With the tax breaks given to these company’s that produce natural resources including oil and gas have seen huge growth. And a program taking advantage of this is freedom checks. You may have heard about freedom checks on the radio or TV. They are program that allows company’s to take their tax cut and put it into a investment opportunity and therefore further allow investors to tap into the booming oil industry. And of course other natural recourse industries.
Freedom checks take advantage of these tax cuts by providing an alternative option for company’s to put their revenue where other than the governments hands. This takes the form of Maser Limited Partnerships or MLPs for short. MLPs are a unit of a company divided up that allows for an investor to buy that unit and take advantage of the company profitable industry. Investors see returns in the form of dividends that usually are from 6 to 9 percent in return rate.
The reason why freedom checks take hold of the tax cuts given to natural recourse company’s aren’t quite stated. However it could speculated is due to the tax free nature of these company’s and the very regulated and stable market they rely on. Due to having a secure market and stream of supply the returns to the investors wont fluctuate too much. For example you wont see a natural gas corporation suddenly go under. Its just no going to happen due to government regulation and safety nets put in place. Another reason is possible because these industries are like economic catalyst. So for a company to get a cut from tax’s and then go on to become a MLP is huge.
In order for these company’s to take part in the program they need to qualify in a few ways. They need to have 90 percent of income come from dealing with natural resources. This can take place in many forms such as storage, transportation, production and manufacturing. And after that they need to distribute freedom checks to their MLP holders, you the investors.