Welcome to DU!
The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards.
Join the community:
Create a free account
Support DU (and get rid of ads!):
Become a Star Member
Latest Breaking News
General Discussion
The DU Lounge
All Forums
Issue Forums
Culture Forums
Alliance Forums
Region Forums
Support Forums
Help & Search
General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region Forums"A Chance to End a Billion-Dollar Tax Break for Private Equity"
A Chance to End a Billion-Dollar Tax Break for Private EquityBy: Steven M. Davidoff at CNBC
http://www.cnbc.com/id/101136739
"SNIP..............................
A recent court case has given the federal government a chance to sidestep Congress and eliminate private equity's billion-dollar tax break. The question is whether the Obama administration takes up the fight.
At issue is "carried interest" a term of art that refers to the profits that a private equity adviser makes from investing in companies. Because of what critics term a loophole and private equity firms call common sense, such income is taxed at the capital gains rate of 20 percent instead of as income, which would put it at a maximum of 39.6 percent. That tax treatment has meant that the heads of private equity firms like the Blackstone Group's Stephen A. Schwarzman pay billions of dollars less in taxes.
This apparent inequality has led many to protest. After all, why should these private equity barons, many of whom are extraordinarily wealthy, get to profit to the tune of extra billions? Even Mr. Schwarzman's co-founder at Blackstone, Peter G. Peterson, has come out against the tax break, stating he "can't justify that."
In defense, private equity advocates like the Private Equity Growth Capital Council argue that the profits are investment income and to change the tax code would mean that private equity firms would have less of an incentive to invest, upending a policy that "has helped America prosper for more than 100 years."
.............................SNIP"
InfoView thread info, including edit history
TrashPut this thread in your Trash Can (My DU » Trash Can)
BookmarkAdd this thread to your Bookmarks (My DU » Bookmarks)
5 replies, 708 views
ShareGet links to this post and/or share on social media
AlertAlert this post for a rule violation
PowersThere are no powers you can use on this post
EditCannot edit other people's posts
ReplyReply to this post
EditCannot edit other people's posts
Rec (12)
ReplyReply to this post
5 replies
= new reply since forum marked as read
Highlight:
NoneDon't highlight anything
5 newestHighlight 5 most recent replies
"A Chance to End a Billion-Dollar Tax Break for Private Equity" (Original Post)
applegrove
Oct 2013
OP
on point
(2,506 posts)1. All income regardless of type should be taxed the same
This is how it used to be and eliminates distortion in markets. A cherished goal of conservatives.
Give it to them. Just be sure to restore old tax rates. Start by killing bush tax cuts. And yes my personal rates would go up but better for the country
RainDog
(28,784 posts)2. k&r n/t
BlueStreak
(8,377 posts)3. Fixing this outrageous loophole through an executive order
might reduce the deficit by 5% or more.
Let's see if Obama is willing to stand up to the hedge fund guys. I doubt it.
badtoworse
(5,957 posts)4. It's not clear the ruling would apply to hedge funds
The basis of the court ruling was whether the fund is actively managing the business in question. As I understand things, hedge funds typically do not do that.
BlueStreak
(8,377 posts)5. Good point. It would apply to the Bains of the world, not hedge funds
because a legitimate hedge fund should always be passive.