By Vicki Needham - 05/28/10 03:40 PM EDT
House Democrats will delay by a year the proposed tax increase on hedge fund managers, raising $17.7 billion over 10 years.
The restructured tax extenders package, under consideration in two parts on the House floor Friday, changes the effective date of the carried interest provision from Jan. 1, 2010, to Jan. 1, 2011.
The change will provide time for investment fund managers to adjust to the new tax, according to a release this morning from the House Ways and Means Committee.
The plan taxes fund managers' performance fee as ordinary income, at up to 39.6 percent, instead of the 15 percent capital gains rate.