Loopholes hard to find in latest tax proposal
(CNS): US Lawmakers have given the investment fund industry an uphill task to try to find any loopholes in a proposal to raise taxes on the profits made on investments. While lawyers have been working around-the-clock advising private equity clients on the impact, there aren’t obvious ideas left that would avoid or skirt the tax. The threat that Washington would raise taxes on the "carried interest" dollars executives earn has been looming for years but escalated in recent months and days as the government faced increasing pressure to raise money.
The proposed tax, currently in a White-House backed jobs bill pending a vote, has become even more contentious by including a proposal that taxes also be raised if the companies themselves are sold. Carried interest is typically the 20-percent slice that private equity executives take from the profit made on their funds. The amounts can be huge if the funds perform well and has made many managers very wealthy.
Category: Business
