Sunday, December 20, 2009

Tell Your Senators to Oppose a Tax Increase on ‘Carried Interest’

Last week, the U.S. House of Representatives voted 241–181 in favor of tax legislation that extends $31 billion in expiring tax cuts, including a one-year extension of the BOMA International-supported 15-year leasehold improvement depreciation timeline that is set to expire at the end of the year. Unfortunately, to partially offset the cost of these tax breaks, the bill also includes a tax increase on the ‘carried interest’ of a partnership increasing the tax from the 15 percent capital gains rate to that of ordinary income (almost 40 percent). During floor debate, House Republicans focused on the negative impact this would have on the commercial real estate industry and job creation.

The bill now heads to the Senate, where it is expected to have a difficult time getting through with carried interest included as a revenue raiser. BOMA will remain vigilant in opposition of this tax increase, while at the same time working to find a way to extend the 15–year depreciation timeline for leasehold improvements.

Contact your Senators today and tell them to oppose increasing the tax on carried interest.

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