Will the carried interest loophole be closed?: Will legislation that amends the Internal Revenue Code to effectively eliminate the long-term capital gains tax preference for carried interest (applicable partnership interests) become law before Jan 1, 2028?

If legislation that amends the Internal Revenue Code to effectively eliminate the long-term capital gains tax preference for carried interest (applicable partnership interests) has become law after Issuance and before Jan 1, 2028, then the market resolves to Yes. To qualify, the legislation must mandate that carried interest be taxed at a rate equal to or greater than ordinary income rates. The legislation will trigger a Yes resolution even if this change only applies to taxpayers above a certain income threshold (e.g., individuals earning over $400,000). Minor adjustments to the required holding period (e.g., extending the current 3-year rule under Section 1061) will not suffice for a Yes resolution.