Buzz Archive:
Memo to Congress - There are Legal Issues With Taxing Carried Interest as Ordinary Income

by Paul Koenig, Co-Founder/Managing Director of Shareholder Representative Services, 1/5/2010

The carried interest debate has kicked into high gear, with legislation currently under consideration that could tax carried interest as ordinary income. Much of the conversation relates to the incentives or disincentives this would create or whether it is advisable. On that front alone, our view is that it's a bad idea. Risk takers and investors should be rewarded for creating value, and that behavior should be encouraged as much as possible.

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