Recent changes to US tax legislation regarding the audit process for partnerships have important implications for CLO managers, as well as more generally in the asset management business. With entities filing as a US partnership for tax purposes now required by the IRS to appoint a US-based Partnership Representative that will liaise with the IRS in the event of an audit and handle other relevant matters, there is heightened interest from investment managers for a third party solution. While a large number of US-based institutions will be able to assume this role for their structures, the appointment of an experienced professional service provider for Partnership Representative services can prove highly optimal in three key scenarios.
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