Hedge Fund & Private Equity Tax

Kaufman Rossin’s hedge fund tax professionals specialize in tax issues that affect hedge funds and private equity firms, providing tax consulting and compliance to hundreds of funds with U.S. and foreign reporting requirements. Our tax services help hedge funds plan strategically to minimize their investors’ tax burdens, comply with regulations and meet their financial goals.

Starting a new fund? We can work with you and your attorney in the initial start-up phase to determine the optimal fund structure to achieve your goals and minimize taxes.

Our tax services for hedge funds and private equity firms include:

  • Tax analysis of fund structuring, including master-feeder, mini-master, side-by-side and blocker corporation
  • Review private placement memorandum (PPM/OM/LPA) tax section for compliance and tax minimization
  • Preparation of Schedule K-1 reporting for investors
  • Preparation of partnership income tax returns for the fund, general partner and investment manager (Form 106S)
  • Preparation of periodic/annual wash sales using our proprietary software
  • Analysis of investments for compliance with wash sale, constructive sales, straddle and mixed straddle rules
  • Analysis of income for proper classification under IRC 475 mark-to-market, 1256, 988, OID/market discount, swaps, and qualified dividends
  • Annual trader vs. investor analysis
  • Trader vs. investor deductions planning
  • Calculation of unrelated business taxable income
  • Partner tax allocations under IRC Section 704 (aggregate vs. layering) using our proprietary software
  • Analysis of waterfall distributions for tax allocation purposes
  • Preparation and compliance of foreign investments such as PFICs, CFCs and foreign partnerships
  • U.S. tax reporting and compliance for foreign investors including FDAP withholding based on U.S. tax treaties and effectively connected income
  • Calculation of withholding of state income taxes
  • Compliance with Foreign Account Tax Compliance Act (FATCA)
  • Response and assistance with federal and state tax notices
  • Ongoing advice on tax issues listed here and more