What Kind of Investor Are You?
What happened to the man who coined the term, Freedom Checks, Matt Badiali, in 2016, was portentous of what is happening now regarding this financial vehicle, and it could be portentous to current investors who are open to a paradigm shift in their thinking.
Traditional investing runs the gamut of insurance products, stocks, bonds, treasury bills, IPOs, ICOs, and the like—gains from most of which are treated as personal income for tax purposes. However, as of the last year or so, a not so new “U.S. statute called Title 26, Subtitle F, Chapter 79 § 7702” a/k/a (26-F) has been receiving a lot of attention.
Furthermore, since this law is established and is decades old, it is not going away any time soon. As it happens, it is instead enjoying a revivification of sorts. Watch this video at Youtube.
Examining 26-F and MLP’s
Uniquely, within Statute 26-F is a heretofore little-known provision regarding real estate and energy companies involved in gas and oil exploration—who produce, process, store, and transport U.S. gas and oil natural resources.
Energy companies in this business stand to profit billions, and they are allowed to operate tax-free as Master Limited Partnerships (MLPs); however, they must generate 90% of revenue from producing, processing, storing, and transporting gas and oil in the U.S., and they must agree to pay shareholders annually or quarterly Freedom Checks. There are reportedly 568 of these companies operating today.
Investing in units of MLPs is actually buying units of a partnership. Freedom Checks trade like a stock, but there the similarity ends, because distributions are considered a return of the investor’s capital instead of income; therefore, there is no income tax to be paid on an investor’s Freedom Checks. All earnings are tax-deferred until the investor’s units are sold, at which time they are taxed at a lower capital gains tax instead of a higher personal income tax rate. Read more at Agora News about Freedom Checks.
What Happened to Matt Badiali?
Getting back to what happened to Matt Badiali just over two years ago, it is first pertinent to note that Mr. Badiali needs only his Dissertation to hold a Ph.D. in Sedimentary Geology from the University of Carolina at Chapel Hill, and he earned his undergraduate degree, a B.S. in Geological and Earth Science/Geosciences at Penn State University. His credentials and his renown are noteworthy.
Given this information about Badiali’s educational background, and couple it with a fortuitous reunion with an old friend, Badiali stepped into a whole, new venture—as his friend happened to carry the reputation among mining investors of being the king for making a profit on his investments. He also happened to be in search of a geologist, to assist him with validating the claims of mines in which he wished to invest.
Stepping into this opportunity, Badiali was given a front-row seat, learning about investing from the best. In light of these facts, it is easy to see why a man with the education and investment background of Matt Badiali has subsequently become an investment specialist in the area of mines and gas and oil wells.
Distributions Get a New Name
It was also around this time that Matt was introduced to MLPs. He learned how the special group of 568 companies, who were operating under Statute 26-F MLP provisions, was paying out quarterly distributions to investors, and he realized that he could share this information with retirees, especially those living on limited incomes, and other investors in order to improve their lives. Thus—these distributions became, Freedom Checks!
Energy Independent U.S.
Currently, the United States is on track to decrease our energy dependence on other nations. Therefore, the 568 companies in the oil and gas business, who have opted to take advantage of the congressional organized MLP provisions in Statute 26-F, have become partners in MLPs and are exploring for new oil and gas resources.
As for Matt Badiali, you can find him diligently validating what these companies are doing and researching industry trends—like what minerals are necessary to make batteries that can power a city. His hands-on approach to research enables his investors to profit because they trust his work.