Skip to main content

View Diary: Florida Station Replaces Rush Limbaugh & Pals With 'Hot' Country - Ouch It Burns Says The GOP (109 comments)

Comment Preferences

  •  The bonuses are paid to the executives (0+ / 0-)

    managing the company, not the investment partnerships. The ability to pay dividends is restricted by IRS and accounting rules, but to the extent they are paid those would go to the private equity investors and is a way that they can take some of their equity investment off the table. If that is done close to a bankruptcy filing there are clawback provisions in the bankruptcy code.

    I think this is one area where changing the laws are very difficult, with the exception that changing the carried interest rules have a lot of political support and would decrease private equity fund manager compensation. However, I don't think changing the carried interest rules would have any impact on the private equity business model or how private equity funds operate. The managers would just earn less after taxes. The challenge is that trying to change what private company owners can do to manage and leverage their business is difficult because the rules would apply to all private companies, not just those owned by private equity investors. When the government tries to make fundamental changes to how private companies can manage their own financial activities we lose support from the business sector, across the board, and politicians of both parties.  

    "let's talk about that"

    by VClib on Mon Jan 06, 2014 at 08:22:05 AM PST

    [ Parent ]

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site