Debate on hedge-fund taxes heats up in Congress

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The favorable tax treatment afforded hedge funds and private equity came under fire again in Congress this week. On Wednesday, a proposal was floated that would strip out the grace period built into already unfavorable legislation recently introduced by the Senate Finance Committee.

In addition, Charles Rangel (D-NY), the powerful head of the House Ways and Means Committee, is expected to propose broader legislation with no grace period.

A Rangel bill could be even tougher on hedge funds than what was introduced last week by Sen. Max Baucus (D-Montana) and Chuck Grassley (R-Iowa), chairman and ranking Republican member of the