Contact Congress about H.R. 2686: Ending Wall Street Tax Giveaway Act
Many investment managers would pay regular income tax on carried interest, instead of lower capital gains tax. Some of that money would also count for Social Security and Medicare self-employment taxes. The bill adds reporting rules and a tougher tax penalty for avoiding the new rules.
Modern Action explains legislation in plain English, helps you choose whether to support, oppose, or ask for changes, and drafts a message tied to the bill, your stance, and the elected officials who can act on it.
Ending Wall Street Tax Giveaway Act is a House bill in Congress.
Who this affects: This bill mainly affects investment fund managers and other service partners who are paid through partnership interests. It also affects partnerships, publicly traded partnerships, investors, tax advisers, and the Internal Revenue Service. These groups would need to track which income comes from services, which income comes from real invested capital, and how the new tax rules apply.
Why this matters: The bill matters because it would change how some high-income investment pay is taxed. Today, carried interest can sometimes get lower capital gains tax rates even when it rewards work. This bill would tax much of that money like wages or business income. It could change fund managers' take-home pay, deal structures, tax planning, and how some partnerships stay eligible for partnership tax treatment.
Key provisions in H.R. 2686
- The bill creates a new tax rule called Internal Revenue Code section 710. It turns net capital gains from certain investment services partnership interests into regular income.
- The rule applies when a person holds a partnership interest because they provide investment services. These services include managing, advising, buying, selling, financing, or similar work for assets like securities, investment real estate, commodities, or partnership interests.
- A partner who sells or gives up an investment services partnership interest would treat the gain as regular income. The partner must count that gain right away, even if another tax rule would usually delay it.
- The bill protects qualified capital interests, which are mostly based on money a partner invested and income already taxed. Gains and losses tied to that capital usually avoid the new rule if they are shared like gains and losses for non-service partners with meaningful interests.
- The bill denies two tax breaks for amounts tied to an investment services partnership interest. Those amounts would not get the lower tax rate for qualified dividends or the special small business stock exclusion under section 1202.
How Modern Action helps you take action on H.R. 2686
You do not have to start with a blank letter. Modern Action turns the bill, your position, and the relevant congressional context into a message you can edit and send. The goal is to make contacting Congress clear, specific, and useful without forcing you to parse bill text or figure out the right office on your own.
Questions people ask about H.R. 2686
- What is H.R. 2686?
- Many investment managers would pay regular income tax on carried interest, instead of lower capital gains tax. Some of that money would also count for Social Security and Medicare self-employment taxes. The bill adds reporting rules and a tougher tax penalty for avoiding the new rules.
- How do I support or oppose H.R. 2686?
- Choose support, oppose, or ask for changes on Modern Action. The action flow drafts the message for you and keeps the wording tied to this bill.
- Who should I contact about H.R. 2686?
- Modern Action uses your location to route the action to the congressional offices relevant to the bill and your representation.
- Can Modern Action explain H.R. 2686 before I act?
- Yes. Modern Action gives you a plain-English summary, current status, and action context before you send anything.
