Hedge Fund Investment Gains Should be Taxed as Ordinary Income According to Latest ABI Poll
Contact: John Hartgen
INVESTMENT GAINS SHOULD BE TAXED AS ORDINARY INCOME, ACCORDING TO LATEST
November 21, 2007,
Alexandria, Va. —A majority of respondents (71 percent)
Twenty-one percent of respondents, however, indicated that hedge funds should continue to be taxed at the lower capital gains rate rather than as ordinary income for the performance of services. Fifteen percent “strongly disagreed” and 6 percent “somewhat disagreed” that hedge funds should be taxed as ordinary income. Five percent of the respondents did not know or had no opinion on the issue.
The House of Representatives recently passed H.R. 3996, the “Temporary Tax Relief Act of 2007,” that would change the current tax code to treat the taxation of hedge fund investment gains as ordinary income, rather than the current lower capital gains rate. The bill, sponsored by House Ways and Means Chairman Charles Rangel (D-N.Y.) passed the House on Nov. 9, after a number of congressional hearings and proposed bills earlier this year highlighted the lower taxation rates on the lucrative gains of private equity.
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