Partnerships

Issues related to the tax treatment of partnerships impact many areas of Chapman and Cutler LLP's financial services practice. We are familiar with all of it from the characterization of a securitization vehicle as a partnership for tax purposes or the consequences of U.S. taxation resulting from the formation of an off shore investment fund, to the economics and allocations in hedge funds and private investment funds.

Our practice group has tackled and resolved a wide variety of issues related to the taxation of partnership structures.

We work with the Asset Securitization and Corporate Finance practice groups on the characterization of financing structures. We partner with the Private Funds Group when clients need their investment vehicles structured. Additionally, we review investment vehicles and hedge funds.

We also work closely with the Corporate and Securities Group in structuring secondary market tax-exempt asset securitization vehicles and with the Trusts and Estates Group in the structuring and reviewing of family partnerships.

Related Practices

Representative Transactions

• The firm structured in-bound investment funds for non-U.S. citizens, including negotiating structure variations for the needs of Kuwaiti and Saudi Arabian citizens.
• We structured out-bound investment funds targeting undervalued technology stocks in Asia.
• Chapman was retained to structure an in-bound investment fund to acquire distressed aircraft.
• We advised on unwinding a real estate partnership with 22 parcels of leased property into three separate partnerships resulting in no overlapping partners or managers.
• Our practice group structured and drafted agreements forming a mortgage finance entity and a sister entity used to provide employees with compensatory equity units in the operating entity. Both were taxed as partnerships.
• We were retained to represent investors in various hedge funds utilizing a variety of trading strategies.
• Additionally, we represented investors in private equity funds organized in the United States, the United Kingdom, the Cayman Islands and other jurisdictions to invest in distressed securities, energy, health care and life sciences, real estate, automotive, bio-tech, communications and other investments.