Hedge Fund News From HedgeCo.Net

IRS Issues New Rule Regarding Hedge Fund Fees

irs_logoNew York (HedgeCo.Net) – The IRS is backing investors who want to change the amount of fees a hedge fund firm can charge.

By issuing a new rule reducing the incentive fees assessed by hedge funds for institutional investors, the sector may begin to invest into the hedge fund industry at a lower cost.

Bloomberg reports: “The ruling, 2014-18, clarifies that hedge funds can charge incentive fees cumulatively rather than annually without running afoul of a tax law change adopted in 2008. These fees, typically equaling 15 percent to 20 percent of an investor’s profits, comprise a big portion of a hedge-fund manager’s annual revenue.”

The IRS also today announced the adoption of a “Taxpayer Bill of Rights” that will provide US taxpayers with a better understanding of their rights. The the new bill takes the multiple existing rights embedded in the tax code and groups them into 10 broad categories.

Alex Akesson
For HedgeCo.net
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