Carried Interests: Final Capital Gain Recharacterization Rules Released
By EsqSocial Corporation 23/02/21
In the 2017 Tax Act, Congress adopted Code §1061, a provision which affects non-corporate holders of certain carried interests, which the new law refers to as applicable partnership interests (“APIs”). Under the new law, certain long-term capital gains (“LTCGs”) relating to APIs may be recharacterized as short-term capital gains (“STCGs”) unless the gains are from assets held for more than three years. LTCGs are taxed at a favorable 20% rate whereas STCGs are taxed at ordinary income rates......
By: Cole Schotz