I make no claims to being an expert on this, but I am pretty sure you can. The key is if you first get all the shares allocated to you, and then decide to sell some of your holdings. I don't see any reason why you can't claim FIFO then, and pay LT CG on the increase. You have to do the math though; it could turn out that paying ST CG tax on the newly acquired units could be less expensive than paying LT CG on the increase from the original purchase price.
The x-date is 2 business days before the date of record. With KMP's next date of record being on Thursday 4-30, the x-div date (or x-dist. date for an MLP) would be Tuesday 4-28.
To be clear: the x-div date is the first day a stock or unit is trading without the right to the dividend/distribution. So you must purchase 3 days before the date of record in order to be the owner of record on the date-of-record. So you must buy KMP or KMR on or before 4-27 to receive the dist/dividend.
And to be clear on which ten day average is used: the following is from the KMR prospectus:
"Each quarter we will calculate the fraction of a share to be distributed per outstanding share by dividing the quarterly cash distribution to be made by Kinder Morgan Energy Partners, L.P. on each common unit by the average market price of a share over the ten consecutive trading days preceding the date on which the shares begin to trade ex-dividend under the rules of the principal exchange on which they may be listed. "
KMR will pay a dividend = to KMP's, at $1.05. The # of KMR shares in the dividend will be calculated based on the average KMR closing price on the 10 days before the X-Div day. As the date-of-record is 4/30, we won't know the exact # of shares/shares owned until then.
you may be comparing net income to distributable cash flow which is deceiving because net income or earnings include non cash expenses like depreciation and depletion which reduce taxable income but do not affect cash flow.
Followup---Vanguard accumulates the fractional shares in .001 of a unit. When you have enough fractions to represent a share you call the brokerage and choose either to sell or convert fractions(Now a full unit) to a full share.