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Limited Partner Exception to Self-Employment Tax – What to Do in Light of the Recent Soroban Case

Background on the Limited Partner Exception  Section 1401 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), imposes self-employment tax on an individual’s self-employment income. Self-employment income is generally defined as the net earnings from self-employment, which is “the gross income derived by an individual from any trade or business carried on by…

Client Alerts | January 10, 2024 | Hedge Funds | High Net Worth Individual Planning | Private Equity Funds

SEC Charges Firms for Violating Whistleblower Protection Rules in Employment Agreements, Separation Agreements and Releases

Firms should review their employment related agreements to determine if any changes are necessary. In September 2023, the SEC issued orders against each of D.E. Shaw & Co., L.P. (“D.E. Shaw”), CBRE, Inc. (“CBRE”) and Monolith Resources LLC (“Monolith”) in connection with provisions in their separation agreements and other employment-related documents that violated Rule 21F-17…

Client Alerts | October 13, 2023 | Executive Compensation | Hedge Funds | Investment Management | Private Equity Funds

Kleinberg Kaplan Partner Christian Gloger and Associate Mike Yi Published in Westlaw Today

A recent client alert written by Kleinberg Kaplan partner Christian Gloger and associate Mike Yi was republished by Westlaw Today. The article, “Private Credit Funds – Structures and Recent Trends,” compares closed-end and open-end credit fund terms and structuring alternatives, as well as overall credit fund space developments. The article was included as part of Westlaw’s June…

Firm News | July 5, 2023 | Hedge Funds | Private Equity Funds

Private Credit Funds – Structures and Recent Trends

In recent years, the alternative investment space has grown in size and significance as a result of a period of low interest rates, favorable monetary policy and financial conditions. The hunt for yield and diversification provided further comfort to institutional investors seeking to gain exposure to this burgeoning industry. In particular, buyout1 and infrastructure2 focused…

Client Alerts | June 22, 2023 | Hedge Funds | Private Equity Funds

Private Fund Managers Must Prepare For Greater Scrutiny and Transparency Regarding Affiliated Service Provider Arrangements

Proposed SEC Rule and Examination Priorities Target “Problematic Compensation Schemes” and “Opaque Reporting Practices” Private fund managers – especially managers of real estate, private equity, and private credit funds – have increasingly used affiliated service providers to perform various tasks for their funds or portfolio companies. Such tasks include asset-level due diligence, loan servicing, property…

Client Alerts | June 13, 2023 | Hedge Funds | Private Equity Funds

NFA Adopts Compliance Rule for Spot Digital Asset Commodity Activity

On March 29, 2023, the National Futures Association (“NFA”) announced the adoption of Compliance Rule 2-51: Requirements for Members and Associates Engaged in Activities Involving Digital Asset Commodities (the “New Rule”),1 which will implement anti-fraud, trading, and supervisory requirements for member firms, including firms registered with the Commodity Futures Trading Commission as commodity pool operators…

Client Alerts | April 3, 2023 | Digital Assets and Cryptocurrency | Hedge Funds | Private Equity Funds

Kleinberg Kaplan Announces Partner Promotions

January 3, 2023, NEW YORK – Premier boutique law firm Kleinberg Kaplan announces the promotion of two associates, Moshe Segal and Derek Stueben, to the firm partnership, effective January 1, 2023. Moshe is a member of Kleinberg Kaplan’s Private Funds & Investment Management group and Derek is a member of the firm’s Corporate Transactional &…

Firm News | January 3, 2023 | Investment Management | Executive Compensation | Hedge Funds | Private Equity Funds | Digital Assets and Cryptocurrency | Emerging Companies & Venture Capital | Mergers & Acquisitions | Securities and Corporate Finance

Kleinberg Kaplan Partners Christian Gloger and Richard Guidice, Jr. Featured in Think Advisor

Kleinberg Kaplan Partners Christian Gloger and Richard Guidice, Jr. were featured in a Think Advisor article, “How Advisors Can Get Ready for New SEC Marketing Rule,” discussing important considerations ahead of the November 4 compliance date for the new SEC Marketing Rule. The article highlighted key takeaways from Christian’s and Rich’s earlier webinar on the…

Firm News | October 20, 2022 | Hedge Funds | Private Equity Funds

Action Items for Advisers prior to Marketing Rule Going Live

The Securities and Exchange Commission (“SEC”) adopted sweeping amendments to the rules that govern advertising by investment advisers and payments to solicitors under the Investment Advisers Act of 1940, as amended (“Advisers Act”). These amendments combined the prior rules governing advertising and paid solicitation into a single revised Rule 206(4)-1 (the “Marketing Rule”).1 All investment advisers registered,…

Client Alerts | October 12, 2022 | Hedge Funds | Investment Management | Private Equity Funds

Asset Managers Who Prepare for Increased Transparency on DEI May See Big Returns

Getting out ahead of mandatory standards could bring organizational improvements and boost assets under management Within an asset management firm’s website may be a page that signals its commitment to diversity, equity, and inclusion (“DEI”) in ownership, leadership, employment and even investing practices. The commitments and aspirations are both admirable and responsive to the increased…

Client Alerts | September 29, 2022 | Hedge Funds | Investment Management | Private Equity Funds