Face the (Tax) Consequences: Preferred Equity Investment in U.S. Operating Companies

Private equity investments are a particularly important subject to tax attorneys involved in entity formations, equity issuances, and M&A transactions. This practice note discusses U.S. federal income tax considerations that arise in a preferred equity investment in an operating company organized and operated in the United States. It focuses primarily on the tax considerations that apply to U.S. investors, but also discusses considerations that may apply to non-U.S. investors, foreign sovereign governments, and tax-exempt entities.

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