Mnuchin: Maybe we’ll keep the carried interest loophole after all

Treasury Sec wants to exclude "job creators" from new rules
August 21, 2017 06:30PM

Treasury Secretary Steve Mnuchin (Credit: Getty Images)

The carried interest loophole may live to enrich another day — at least for some funds.

“We will close the loophole for hedge funds in carried interest,” Treasury Secretary Steven Mnuchin said at an event in Kentucky on Monday, according to Bloomberg. “What we are focused on is there are many other types of funds that do create jobs and we want to make sure we don’t discourage investment.”

It wasn’t immediately clear what kind of funds Mnuchin meant, and how many jobs they need to create to still receive the benefit of the loophole. Carried interest rules allow fund managers to tax much of their income at the capital gains rate, rather than the much higher income tax rate.

During his campaign President Trump railed against the loophole, saying it allowed hedge fund managers to get “away with murder.”

The Blackstone Group, the nation’s largest private landlord, is one of the firms benefiting from carried interest rules. [Bloomberg] — Konrad Putzier