Tuesday, September 20, 2016

Carried Interest Tax Loophole

A hedge fund manager in Chicago gets paid $4 million per day and pays a lower tax rate than average working families. That's because of something called the "carried interest loophole.” 1
This loophole allows investment managers at hedge funds and in private equity to pay a reduced tax rate of 23.8 percent on the portion of their income deemed as a capital gain—or, return on investment. This is a lower effective tax rate than what middle-class families face. Further, it is far lower than the rate they would face if this income was correctly classified as simply the salary they earn for managing other peoples’ investments.
Hillary Clinton, Bernie Sanders and Elizabeth Warren all agree that we must close this loophole, which allows Wall Street money managers to pay a lower tax rate than working families. But far too many members of Congress have been silent on this issue.
They need to hear from you today!
Click here to sign the petition to Congress to close the “carried interest loophole,” which allows certain investment managers to pay a lower effective tax rate than you and me.

Since 1979 the top 1 percent’s income share has doubled. And last year, the top 25 hedge fund managers earned a total of $13 billion. By closing loopholes that benefit the top 1 percent, we’ll be able to invest in programs that help working families, such as accessible, affordable, high-quality child care and early childhood education.
Even many Republicans won’t defend this kind of special treatment for the super-rich in public. In fact, even Donald Trump wants to close this particularly egregious loophole—though, in typical Trump fashion, his plan then returns this money to the richest households by cutting other taxes and introducing new egregious loopholes.
It’s time for Congress to listen to working people, not lobbyists and wealthy campaign contributors.
Sign the petition to Congress today to close the “carried interest loophole” and use the tax code to restrain the incomes of the top 1 percent.
Together let’s build an economy that works for all Americans, not just the wealthy few.
Thank you,
Josh Bivens
Research and Policy Director, EPI Policy Center

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