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Course Details

Course Information
  • smart_display Format

    Live Online with Live Q&A

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Banking and Finance

Date & Time
  • event Date

    Tuesday, November 4, 2025

  • 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.


  • Live Online


    On Demand

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$347.00
$294.95
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Discount expires 10/7/25

This course is $0 with these passes:

CLE
ALL

This CLE course will examine the three-year holding period requirement for carried interests under IRC Sec. 1061 and discuss structuring techniques that can preserve long-term capital gains treatment for private equity and hedge fund managers.

Faculty

Christopher Fiore Marotta
Partner
Holland & Knight LLP

Mr. Marotta is a tax attorney in Holland & Knight's Boston office. He assists clients with a range of domestic and international tax issues. Mr. Marotta is experienced in negotiating and structuring the purchase and sale of businesses, negotiating loan agreements for lenders and borrowers, drafting joint venture agreements (including with respect to real estate matters), advising insurers on representation and warranty policy coverage, structuring inbound and outbound investments, forming investment funds, drafting U.S. tax disclosures for private placement memoranda and public offerings, and other issues relating to mergers, acquisitions and reorganizations. He also advises on Section 1202 qualified small business stock (QSBS) issues. Prior to joining Holland & Knight, Mr. Marotta advised private equity and corporate clients on the tax aspects of bankruptcies and domestic and multinational mergers and acquisitions in the New York office of an international law firm. He also has experience providing advice on the structuring of investments in overseas and domestic target companies and other domestic and international tax matters from working in the New York office of an international accounting firm.

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Description

Investment fund managers often participate in a portion of the investment fund's profits through a "carried interest" structured as a partnership interest in the investment fund. For partnership interests, the U.S. federal income tax treatment of carried interest is based on the character of the income earned by the fund. For fund managers, IRC Sec. 1061 may increase the holding period required for long-term capital gain treatment from one year to three years.

IRS and Department of the Treasury regulations limit certain planning opportunities and include calculation methodologies and partnership-level reporting requirements. Several techniques remain available to preserve long-term capital gains treatment for investment fund managers. Planning could include alterations to the overall business deal, such as restricting the types of gains in which the carried interest will share or permitting the fund manager to waive the right to participate in gains from certain investments but be made whole from other fund income and gains. Counsel should consider structural adjustments to how an investment is made and the form of an exit.

Listen as our panel examines the three-year holding period requirement for carried interests under IRC Sec. 1061 and discusses the planning opportunities that may be available for private equity and hedge fund managers to preserve long-term capital gains treatment based on a one-year holding period rather than the three years outlined in 1061.

Outline

I. Taxation of carried interest for fund managers under IRC Sec. 1061

II. Tax planning opportunities

A. Contributing capital in connection with the issuance of carried interests

B. Transfer of carried interests to unrelated parties

C. Distributing appreciated assets to holders of carried interests

D. Special allocations

E. Qualified dividends and 1231 property

III. Practitioner pointers

Benefits

The panel will review these and other critical issues:

  • What is the scope of IRC Sec. 1061?
  • What are some alternative approaches that tax counsel should consider to preserve long-term capital gains treatment?
  • How does IRC Sec. 1061 impact qualified dividends and gains from the sale of property taxed under IRS Sec. 1231, and how might that impact tax planning under IRC Sec. 1061?