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16 Cards in this Set
- Front
- Back
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Cash Flow Analysis
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Takes into account the Revenues VS Expenses |
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Intangible Drilling Cost (IDCs) vs Tangible |
Write offs for the expense are usually 100% deductible in 1st year of operation TDC: has SV, depreciated |
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Depletion Allowances
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tax deductions that compensate the partnership for the decreasing supply of oil or gas (or any other resouces/mineral) -> allowances only taken once oil or gas is sold |
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4 types of oil and gas partnerships
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developmental-drill existing fields to set up new reserves income- immediate income from sale of existing oil Combination-partnership allocates dollars between income and exploratory |
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Income Oil and Gas partnership
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partenership buys producing oil/gas wells no drilling costs immediate cash flow oil price risk Income sheltering (from depletion) Lowest degree of risk |
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Certificate of Limited Partnership
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effective when filed in home state of partnership |
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Partnership agreement aka agreement of limited partnership |
Gen Partners can charge mgmt. fee, bind partnerships into contracts, distribute cash |
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Subscription agreement |
Subscription agreement- Filed by prospective LP's, appoints GP to act on behalf of LP and is only effective when gp signs. Must include Investors Net Worth, Invs Annual Income, Acknowledgement of risk, power of attorney appointing GP at agent of prtnership |
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nonrecourse loans
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Only effect real estate programs |
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Investor acquires limited partner status in dpp when
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subscription agreement is signed by both him and the general partner
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Priorities of a DPP customer
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2 Tax write offs 3 Liquidity and Marketeability 4 SEC Approval |
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Limited Partnership commission structure
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upfront costs (comish, accounting costs) do not reduce the beginning basis |
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Where can passive LPP losses be used to offset gains
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CANNOT be used to offset actively managed investment income |
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Depletion allowances based on what?
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Allowed to compensate for a mineral resources, which is considered accomplished when it is SOLD |
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Priority of Payments when a LP is liquidated
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Partners -Limited then General |
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Blind Pool offering
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nonspecified program - investment in a program where less than 75% of assets are specified as to their use |
