Connecticut Governor Hedge Fund
Gov. Rell Pushes NY Hedge Funds to CT as Bill Dies
Connecticut Governor M. Jodi Rell said it would be a "wise choice" for hedge-fund managers to move to her constituency and away from New York, as Connecticut's tax regime is more favorable.
Rell's admonition came despite New York Governor David Paterson inconspicuously dropping a tax proposal last month that would have treated hedge-fund managers' performance incentive or carried interest as a capital gain, rather than as ordinary income, and subjected it to tax rates as high as 35%.
In a handout titled "Connecticut: The Wise Choice," Rell compared the tax regimes for both states, as though the tax proposal were still being considered by the New York legislature.
The effective tax rate for a married Connecticut resident fund manager earning $2 million in management fees and $5 million in carried interest would amount to 17.46% if the person works in New York, she said; the tax rate would be 6.28% if the manager works in Connecticut. Source