Discussion:UBTI inside an IRA

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Discussion Forum Index --> Advanced Tax Questions --> UBTI inside an IRA
Discussion Forum Index --> Tax Questions --> UBTI inside an IRA

Dusty (talk|edits) said:

5 March 2008

Ok, I searched the forum and I can not find the answer to my question.

I have a client who opened a self directed IRA. My client directed the custodian of the IRA to invest in a Tax Sheltered Oil Rig partnership. The partnership is sending a K1 to my client. The partners Identifying Number is the number for the custodian of the IRA. They have UBTI and they are taking money out of the IRA to pay for the UBTI. My client wants to deduct the UBTI on his taxes and put the K1 information on his tax return.

I do not believe he can put this information on his personal return as the Identifying Number on the K1 and UBTI is the custodian of the IRA not his identifying Number. Can anyone point me in the right direction here?

Thanks,

Dusty

Kevinh5 (talk\|edits) said:	5 March 2008
you are correct, the IRA paid the tax, not him. He is like the attorney who represents himself when he does a 'self-directed IRA'.