The Homa Files

Finally, something out of the Obama brain trust that I agree with …

“Managers at private-equity firms, real-estate investment trusts and other investment partnerships (e.g. hedge funds) would pay an additional $24 billion in taxes over the next decade. Currently, most pay taxes at the 15% capital-gains rates on the bulk of their compensation, which comes in the form of something called “carried interest,” which entitles them to a share of the firm’s profits. Because it isn’t a return on an investment they actually made, many tax experts argue it is more akin to a fee or salary for their services. Mr. Obama’s budget would require most investment managers to pay ordinary income taxes on that income.”

Note: Larry Kudlow, conservative economist (with whom I usually agree), said on CNBC: “Worst possible action he can imagine”

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Source: WSJ, “Business Braces for a Big Hit”, Feb 27, 2009
http://online.wsj.com/article/SB123569739787189001.html

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This entry was posted on March 4, 2009 at 7:58 am and is filed under Obama Administration, Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.