Carried interest loophole preserved, fund managers taxed at capital gains rate
Enacted5/10
Federal · TCJA (Pub. L. 115-97), added 3-year holding period only; Big Beautiful Bill preserved · Signed Dec 22, 2017
Impact 5/10
Fund managers' 'carried interest' share of profits is taxed at 15–20% capital gains rates rather than 37% ordinary income. CBO estimates the loophole costs ~$14B over 10 years. Allows hedge fund/private equity partners earning $10M–$100M+ to pay lower rates than their assistants.
TaxesSafety net & benefitsWorking-age adultsHigh-income
Sources
✓ Verified against primary sources 2026-08-16