S 4330

This bill, the Ending the Carried Interest Loophole Act, aims to close a tax loophole that has historically allowed investment fund managers to pay significantly lower tax rates on their profits than other high-income earners. It proposes to treat partnership interests received for services as ordinary income, similar to wages, and to establish a ‘deemed compensation’ calculation to determine the amount of income attributable to these interests. The bill also modifies how invested capital is calculated and introduces rules to prevent abuse of the system.