BarbriSFCourseDetails
  1. keyboard_arrow_leftBack

Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Tax Law

Date & Time
  • event Date

    Thursday, August 12, 2021

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

  • BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

  • BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).

$347.00
CLE
CPE
ALL

This CLE/CPE course will provide guidance to tax counsel and advisers on critical tax considerations for secondary sales of interests in private funds. The panel will discuss tax and fund structuring challenges impacting the buyers, sellers and the fund, transfer restrictions, tax elections, allocation of tax and expenses, and tax withholdings. The panel will also offer fund structuring techniques to minimize potential implications in the event of a sale.

Faculty

Matthew A. McDonald
Partner
Mayer Brown LLP

Mr. McDonald is a partner in the Tax Transactions practice of Mayer Brown's Chicago office. As a member of the firm’s Fund Formation & Investment Management practice, he regularly represents fund sponsors in all aspects of the structuring and operation of private investment funds with a particular focus on real estate and real estate-related assets. Mr. McDonald also represents a variety of taxable, tax-exempt and non-US investors in structuring tax-efficient investments in real estate, private equity and hedge funds. His experience includes matters involving the formation and operation of partnerships, limited liability companies and real estate investment trusts (REITs), foreign investment in the United States under FIRPTA and outbound investment in foreign jurisdictions. Mr. McDonald also advises U.S. and foreign corporations and partnerships on acquisitions, divestitures and other restructuring transactions.

expand_circle_down Expand to View Full Bio expand_circle_up Collapse Bio
Sharon Kim
Partner
Ashurst LLP

Ms. Kim advises the firm's leading financial institution and investment fund clients and investors on the U.S. tax aspects of financing, capital markets, and investments transactions, with an emphasis on U.S. tax matters relevant to cross-border transactions such as FATCA, general U.S. withholding tax, section 871(m), FIRPTA, and U.S. trade or business issues. She has extensive experience representing issuers of structured products and debt and equity securities, and advising lenders, borrowers, sponsors, managers and investors on U.S. tax matters in connection with credit facilities, private equity and debt funds, structured and derivative products, and securitization transactions, including CLOs and MBS.

expand_circle_down Expand to View Full Bio expand_circle_up Collapse Bio
JoonBeom Pae
Partner
Mayer Brown LLP

Mr. Pae's practice focuses on the tax aspects of the formation, financing and investment activities of domestic and international private funds. He regularly advises both sponsors and investors in connection with structuring and operation of various types of funds, including buyout, infrastructure, real estate and debt funds. Mr. Pae is also experienced in secondary sale of fund interests and M&A transactions involving partnerships.

expand_circle_down Expand to View Full Bio expand_circle_up Collapse Bio

Description

In response to the coronavirus pandemic, decreased values of certain assets, and other items impacting investments, fund investors may seek options to liquidate their interests. Tax counsel and advisers must identify essential tax rules applicable to secondary sales of interests in private funds and implement methods to avoid or minimize any adverse tax consequences for sellers and buyers.

The secondary private equity market involves the buying and selling of preexisting interests in private market funds. Investors purchase these interests from limited partners seeking to exit primary private equity funds before they are fully liquidated. However, this process isn't without potential legal and tax ramifications. Secondary sales require counsel and advisers to have a complete understanding of tax and structuring considerations, such as the impact of transfer restrictions, tax elections, and allocation of taxes and expenses, all of which significantly impact the transaction.

Listen as our panel discusses tax and fund structuring challenges impacting a buyer, seller, and private equity funds stemming from secondary sales and offers techniques for structuring transactions to minimize potential tax implications.

Outline

  1. Options for investors in liquidating fund interests
  2. Sale of fund interests to the secondary market
  3. Key tax considerations
  4. Best practices to avoid unintended tax consequences

Benefits

The panel will review these and other key issues:

  • What options are available to investors in liquidating fund interests?
  • What are the key tax considerations for investors selling their interests in private funds on the secondary market?
  • What are the common transfer restrictions and resulting tax scenarios to examine?
  • How do the fund structure and tax elections impact the sale of an investor's interests in a private fund?
  • How can you avoid adverse tax consequences of a sale to a non-U.S. investor or tax-exempt investor?
  • What issues arise with the allocation of taxes and expenses between buyer and seller?
  • What are critical withholding tax issues to consider?

NASBA Details

Learning Objectives

After completing this course, you will be able to:

  • Recognize key tax issues for investors selling their interests in private funds on the secondary market
  • Ascertain common transfer restrictions and resulting tax implications to the buyer and seller of interests in private funds
  • Understand how fund structures and tax elections impact the sale of an investor's interests in a private fund
  • Ascertain methods to avoid adverse tax consequences of a sale of interests in private funds to a non-U.S. investor or tax-exempt investor
  • Identify key issues concerning the allocation of taxes and expenses between buyer and seller
  • Recognize critical withholding tax issues and certification

  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules; supervisory authority over other preparers/accountants. Working knowledge of partnership/corporate structure, private fund structures, debt financing, merger, and liquidation.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).