Friday, 22 August 2014
Last updated 10 hours ago
Oct 23 2007 | 12:32pm ET
In a sign that the alternative investments community fears it will not be able to scuttle new rules that would vastly inflate their tax bills, it has struck upon a new strategy to make the tax hike more palatable.
Lobbyists for private equity firms and hedge funds are pushing to double the length of the grace period contained in a Senate bill to 10 years. Under the proposed legislation sponsored by Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa), alts firms that go public will be subject to the corporate tax rate of as much as 35%, rather than the 15% capital-gains rate they pay as partnerships.
Further, the industry is pushing to extend the law to all hedge fund and private equity firms that go public. As currently written, the bill applies only to firms that have completed the initial public offerings or filed to do so before the bill was introduced on June 14. Only three firms-The Blackstone Group, Fortress Investment Group and Los Angeles hedge fund Oaktree Capital Management-would qualify under that provision.
"Our members’ position would be that all private equity firms should be treated equally," Doug Lowenstein, head of the Private Equity Council, said in an interview. Some private equity firms are reportedly saying that the rule as currently written would give Blackstone an unfair edge.
Aug 4 2014 | 7:42am ET
By now, U.S. and international subscribers have received their home or office delivery of the special 500th issue of Futures magazine. You can too!—a very special offer follows. The issue is the largest in years—filled with the best trading strategies and stories from 43 years of being the primary publication for commodity, stock, options and forex traders. Read more…
The July/August 2014 issue is our largest in years—filled with the best trading strategies and stories from 43 years of being the primary publication for commodity, stock, options and forex traders.
The Alpha Pages Editor's Note