About the Course
Introduction
This CLE/CPE course will provide tax counsel and advisers with a detailed analysis of the tax implications of equity compensation grants in partnerships and LLCs. The panel will discuss profit versus capital interests, phantom equity, the application of Section 83, carried interest, and best tax planning methods for compensatory interests and other arrangements.
Description
There are several issues faced by partnerships and LLCs when handling equity compensation matters. These issues are unique to partnership and LLC equity compensation due to the differences in the tax regime applied to entities taxed as partnerships compared to those taxed as corporations. Tax counsel and advisers must have a thorough knowledge of the forms that equity compensation can take and applicable tax rules to avoid any unintended tax consequences.
Partnership and LLC equity compensation can take several forms, including granting profits interests, capital interests, and options to acquire such interests. Each arrangement has specific economic and tax implications, including whether to treat the grantee as an employee or a partner for tax purposes.
Also, tax counsel and advisers face additional challenges, including applying Section 83, significant changes to carried interest taxation, and the treatment of fee waivers. These and other issues present planning and compliance challenges to carefully consider.
Listen as our experienced panel offers a thorough and practical guide to planning considerations in partnership and LLC grants of equity compensation, phantom equity, the application of Section 83, and the impact of new carried interest rules.
Presented By
Ms. McDaniels has over two decades of experience advising clients on compensation and benefits matters. She counsels companies across multiple industries at all stages of their life cycle--from startups to multinational corporations--on both day-to-day matters and transformative events. Ms. McDaniels also advises boards of directors, executives and investors.
Mr. Patel, Global Head of White & Case's Employment, Compensation and Benefits practice, advises clients on the full spectrum of executive compensation and employee benefits issues. His significant experience and knowledge in this area has made him a valued resource for a range of US and international clients, including public and private companies, boards of directors and executives.
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This 90-minute webinar is eligible in most states for 1.5 CLE credits.
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Date + Time
- event
Tuesday, July 29, 2025
- schedule
1:00 p.m. ET./10:00 a.m. PT
- Types of equity compensation and alternatives for partnerships and LLCs
- Planning considerations under current tax law
- The impact of carried interest rules
- Reporting and compliance challenges for partners/members
- Best practices in structuring equity compensation arrangements to avoid unfavorable tax treatment
The panel will review these and other key issues:
- Capital interest versus profits interest as equity compensation in partnerships and LLCs
- Different planning methods based on the type of equity compensation
- Application of Section 83 and unvested interests
- Section 409A and compensatory grants of equity interests in partnerships and LLCs
- Tax treatment of carried interest and fee waivers arising from compensatory grants of equity interests
- Best practices and critical considerations for equity compensation grants in partnerships and LLCs
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