Indirect Attack on Carried Interests: the NYC Department of Finance’s Contemplated Change in Unincorporated Business Tax Policy
24 February 2012
Mayer Brown Legal Update
Decision-makers at the New York City Department of Finance have notified practitioners that the Department is actively considering the implementation of a new unincorporated business tax (“UBT”) audit policy targeted at investment partnerships, such as hedge funds and private equity funds. The likely upshot of the new policy, if ultimately adopted, is that the Department will increase its audits of such funds and will seek to deny certain expense deductions claimed by the funds.