Vic Fleischer Joins NY Times DealBook

Victor Fleischer (Colorado) has launched a new tax column (Standard Deduction) as part of the New York Times DealBook site, edited by Andrew Ross Sorkin. Vic's inaugural column is What’s at Issue in the Private Equity Tax Inquiry:

The New York attorney general, Eric T. Schneiderman, is said to be investigating private equity firms’ use of a tax strategy known as management fee waiver programs.

Fee waivers are complicated. The main tax strategy is to turn fees, which are normally taxed as ordinary income, into low-taxed capital gains. But another way to understand the strategy is to look at the overall economic benefit of the deal. At issue is whether, through these Byzantine programs, private equity executives are improperly using pretax dollars, rather than after-tax dollars, to invest in their own funds.