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- Title
THE TAXATION OF PRIVATE EQUITY CARRIED INTERESTS: ESTIMATING THE REVENUE EFFECTS OF TAXING PROFIT INTERESTS AS ORDINARY INCOME.
- Authors
Knoll, Michael S.
- Abstract
In this Article, I estimate the tax revenue effects of taxing private equity carried interests as ordinary income rather than as long-term capital gain as under current law. Under reasonable assumptions, I conclude that the expected present value of additional tax collections would be between 1 percent and 1.5 percent of capital invested in private equity funds, or between $2 billion and $3 billion a year. That estimate, however, makes no allowance for changes in the structure of such funds or the composition of the partnerships, which might substantially reduce tax revenues below those estimates.
- Subjects
TAX collection -- Law &; legislation; CAPITAL gains tax laws; INTERNAL revenue; PRIVATE equity; CAPITAL investments
- Publication
William & Mary Law Review, 2008, Vol 50, Issue 1, p115
- ISSN
0043-5589
- Publication type
Article