I owned some Energy Transfer Partners until last year. They always had a good dividend but I decided to dump them out of all accounts when I got weary of waiting forever each spring for the damn K-1 forms and having to deal with that bit of hassle each year for taxes in my non-retirement brokerage account. One of the accounts where I had that name was my Roth and I just let them simmer along for years until I dumped them in 2018.
Vanguard asked me this summer for cost basis info for Energy Transfer (they lacked it because I was with Scottrade before my divorce). I provided it, thinking it was odd that the word 'taxes' and 'Roth' were in the same sentence. Whatevs, I thought they were doing account cost basis as a housekeeping thing as I have seen done and didn't think much of it.
Now, Vanguard has zapped my Roth account for several hundred dollars for "withholding" and mentioned they filed the form 990-T as required by October 15th.
Wut?
I presume this is because while I owned ETP in the Roth it still is a partnership and therefore I am on the hook for my part of their gain, much like I had to show my part in my taxable brokerage account with my K-1 filing annually. The Roth does not shelter me from that. Guessing there.
Anyone familiar with this?
I am so glad I dumped them, they along with Magellan were just pains in the ass even though I liked the dividends.