Estate Planning and Carried Interest: Estate Tax Reduction Strategies for Private Equity and Hedge Fund Founders

Strategies for Wealth Transfer and Asset Protection to Avoid Adverse Tax Consequences

Recording of a 90-minute CLE/CPE webinar with Q&A

Conducted on Tuesday, August 1, 2017
Recorded event now available

This CLE/CPE webinar for estate planning counsel who advise—or want to advise—private equity and hedge fund founders will discuss the estate planning opportunities presented by carried interest. The panel will outline how planners can help structure founders’ transfers of carried interest to family members, dive into the particulars of Chapter 14 of the Internal Revenue Code, explore the unintended impact on founders’ estate planning, and discuss multidisciplinary strategies specialists are implementing for these high net worth clients.


Virtually every private equity or hedge fund uses carried interest—a share in the fund’s profits in excess of a minimum return—as part of its economic structure. Because carried interest can appreciate substantially if a fund is successful, it is an ideal asset to plan for using in a variety of estate planning techniques.

Careful planning is required to take advantage of the opportunities that carried interest offers for transferring wealth. IRC Chapter 14 governs the valuation of certain lifetime transfers to family members.

Under a typical private equity or hedge fund structure, a founder’s transfer of carried interest to one or more family members may trigger gift tax consequences under Chapter 14 as well as under traditional gift tax principles. Strategic estate planning can help fund sponsors take advantage of certain transfer techniques to achieve tax savings.

Listen as our experienced panel discusses the estate planning opportunities presented by carried interest. The panel will discuss how a professional team of advisers can work together to provide private equity and hedge fund managers with bespoke carried interest planning techniques that take advantage of wealth transfer opportunities while avoiding unintended adverse tax consequences.


  1. Overview of private equity and hedge fund structure and estate planning issues
  2. Discussion of IRC Chapter 14 and potential gift tax implications
  3. Unintended impact of carried interest on founders’ estate planning
  4. Strategies for avoiding unintended tax consequences


The panel will review these and other key issues:

  • How can proper planning help avoid triggering adverse tax consequences under IRC §2701?
  • Which estate planning techniques are most effective for transferring carried interest?
  • How can a fund founder structure an investment to take advantage of the vertical slice exception?
  • Which “non-vertical” planning ideas should be considered?

Learning Objectives

After completing this course, you will be able to:

  • Determine the investment structure of private equity and hedge funds
  • Identify potential gift tax implications of transferring carried interest to a fund founder’s family member
  • Discern how to strategically transfer carried interest to family members
  • Recognize exceptions available under §2701 to avoid adverse tax consequences of transferring carried interest


Marissa Dungey, Partner
Withers Bergman, Greenwich, Conn.

Ms. Dungey's practice focuses on transfer tax planning, estate planning and trust structuring for wealthy individuals and their families. She works with individuals and their advisors to develop and implement sophisticated planning strategies designed to minimize gift, estate and generation-skipping transfer taxes with trust planning optimized to achieve the individual's tax and non-tax goals, including creditor protection, charitable giving and income tax efficiency. She regularly advises on planning with complex assets including interests in hedge funds, private equity funds and family businesses. She also advises on estate and trust administration matters, including adapting existing trusts to improve their tax efficiency and utility.

Kevin Matz, Partner
Stroock & Stroock & Lavan, New York

Mr. Matz concentrates on domestic and international estate and tax planning, estate administration and related litigation. His practice primarily involves advising high net worth individuals with respect to wealth transfer planning; will and trust drafting; gift, estate, income and generation-skipping transfer tax planning and tax return preparation; charitable gift planning; probate proceedings and estate administration; and associated litigation as well as corporate counseling. He has also advised clients on entity and succession planning, including the use of family limited partnerships, the use of grantor retained annuity trusts, transfers to irrevocable trusts involving complex valuation issues, qualified personal residence trusts, irrevocable life insurance trusts, and the use of charitable remainder trusts, charitable lead trusts and private foundations to further both family planning and philanthropic objectives.

Cristine M. Sapers, Partner
Loeb & Loeb, New York

Ms. Sapers focuses her practice on sophisticated estate and tax planning for high-net worth individuals, preparation of wills and trusts and the administration of large trusts and estates. Her area of specialty is working with hedge fund managers and principals of private equity firms on estate planning transfers of interests in their investment funds, including their carried interests. She has substantial experience handling IRS gift and estate tax audits and negotiating and resolving trust and estate disputes. She also counsels donors on charitable giving and advises private foundations and public charities on tax law, nonprofit corporation law and other matters. 

Shishir Khetan, Managing Director
Stout Risius Ross, Houston

Mr. Khetan is a Managing Director in the Valuation Advisory group. He has extensive global experience in corporate finance, valuations and strategic planning. He has advised clients ranging from Fortune 500 companies to medium and small privately held companies, private equity and investment funds, family offices, and accounting, legal and tax advisors. He has over two decades of financial advisory experience covering many industries, resulting in a comprehensive understanding of valuation concepts, capital markets, financial and economic analyses.

EA Credit

Enrolled Agent credit processing is available for an additional fee per person.

EA Processing $5.00


CLE On-Demand - Streaming Video

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Includes recorded streaming video of full program plus PDF handouts.

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*Only available for attorneys admitted for more than two years. For OH CLE credits, only programs recorded within the current calendar year are eligible - contact the CLE department for verification.

**NH attendees must self-determine if a program is eligible for credit and self-report their attendance.

CLE On-Demand Video $297.00

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Recorded Event

Includes full event recording plus handouts.

Note: Self-study CPE and EA credits are not offered on recorded events.

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AK, AZ, CA, CO, CT, FL, GA, HI, IA, ID, IL, KY, ME, MN, MO, MT, ND, NJ, NM, NY, OR, PA, TN, TX, UT, VT, WA, WV, WY (Note: Some states restrict CLE eligibility based on the age of a program. Refer to our state CLE Map for additional information.)

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Program Materials

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Program Materials

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Customer Reviews

Better than I expected. Well done on both subject matter and production quality.

Jeff Simpson

Gordon, Fournaris & Mammarella

The seminar was very informative and easy to understand.

Amy Allison

Anderson Hunter Law Firm

I thought the information provided was great.

Erika Gamiz

Law Offices of Marcia L Kraft

The program was well organized and discussed the major issues.

Roxy Hammett

Wolff & Samson

The webinar offered excellent insight into some specific areas.

Beth Ann R. Lawson

Virginia Beach Law Group

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Estate Planning Advisory Board

Gary D. Altman

Principal and Founder

Altman & Assoc.

Brian M. Annino


Annino Law Firm

Richard S. Franklin


Franklin Karibjanian & Law

J. Leigh Griffith

Partner and Practice Group Leader - Tax

Waller Lansden Dortch & Davis

L. Paul Hood, Jr.

Consultant, Speaker and Author

The University of Toledo Foundation

Denise L. Iocco


Windels Marx Lane & Mittendorf

Donna J. Jackson


Donna J. Jackson, Attorney at Law

Salvatore J. LaMendola


Giarmarco Mullins & Horton

Edwin P. Morrow, III, Esq.

Senior Wealth Specialist

Key Private Bank Wealth Advisory Services

Scott K. Tippett


The Tippett Law Firm

Susan M. von Herrmann


Perkins Coie

or call 1-800-926-7926

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