SBIA Comment Letter: Section 1061


The Small Business Investor Alliance informs and educates its members on the issues that impact their ability to invest, and works to promote public policies that help small businesses gain access to the capital that is crucial to U.S. economic growth and American job creation. 


The IRS on January 7, 2021, submitted for official publication final regulations regarding Section 1061 of the Internal Revenue Code (26 U.S.C. 1061) on the tax treatment of certain partnership interests (i.e., “carried interest”) held in connection with the performance of services. This Code section extends the holding period requirements from one-year to three-years for taxpayers to receive long-term capital gains treatment for gains on carried interest in an applicable partnership interest (“API”). SBIA filed a comment letter last October with the IRS regarding its regulatory proposal, and the SBIA letter had a direct impact because the final rule incorporates several of SBIA’s key recommendations. Read more >

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About the Small Business Investor Alliance (SBIA)

The Small Business Investor Alliance is the association of senior investment professionals focused on the lower middle market whose members represent the entire private capital ecosystem. It is an alliance for professional fellowship, business opportunities, innovation, regulatory expertise, and market data. SBIA works on behalf of its members as a tireless advocate for policies that promote competitive markets and robust domestic investment for growing small businesses. SBIA has been playing a pivotal role in promoting the growth and vitality of the private equity industry for over 60 years. For more information, visit or call (202) 628-5055.

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