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Changes to Taxation of Investment Management Income and Funds

This act modifies how income from managing investment funds and similar entities is taxed. The goal is to ensure these incomes are treated as ordinary income rather than capital gains, potentially affecting the tax burden for these individuals. It also introduces new rules for accounting for losses and gains from such investments.
Key points
Income from investment management will be taxed as ordinary income, not capital gains, potentially increasing tax liabilities for fund managers.
Detailed rules are introduced for what constitutes investment services income, including for Special Purpose Acquisition Companies (SPACs).
Penalties for underpayments related to avoiding these new rules are increased, aiming to deter non-compliance.
Investment management income will be included in self-employment earnings, which may impact social security contributions.
article Official text account_balance Process page
Introduced
Citizen Poll
No votes cast
Additional Information
Print number: 119_S_445
Sponsor: Sen. Baldwin, Tammy [D-WI]
Process start date: 2025-02-06
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Summarized by: gemini-2.5-flash-preview-05-20
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

Carried Interest Fairness Act of 2025

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 119_S_445.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2025-02-06.

What are the main provisions?

Key points include:

  • Income from investment management will be taxed as ordinary income, not capital gains, potentially increasing tax liabilities for fund managers.
  • Detailed rules are introduced for what constitutes investment services income, including for Special Purpose Acquisition Companies (SPACs).
  • Penalties for underpayments related to avoiding these new rules are increased, aiming to deter non-compliance.
  • Investment management income will be included in self-employment earnings, which may impact social security contributions.
What is the specific legal status?

The current status is Introduced.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. Baldwin, Tammy [D-WI].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-23.

CATEGORIES

Taxes Economy