Extract to table

Andover & Strauss will be responsible for preparing the Schedule K-1s for the CV and must be briefed on the dual-tranche carry reporting requirements

This extended holding period applies at two levels: First, the API itself must be held by the taxpayer for more than three years

Second, under the Treasury Regulations promulgated under Section 1061, the underlying assets generating the gain within the partnership must also have been held for more than three years

" For a gain allocated to a carried interest to receive long-term capital gain treatment, both (i) the carried interest must have been held for more than three years and (ii) the underlying partnership asset generating the gain must have been held for more than three years

In this scenario, the cash-out transaction effectively occurs at the CV level (or as a secondary transfer), and the allocation of gain between the Fund II Carry and the CV Carry — and between the Legacy Carry Tranche and the New Carry Tranche — must be analyzed in the context of the overall transaction structure

The transaction structure for the cash-out must be coordinated with Hawthorne Reid LLP (Vanessa Liu) and with the broader transaction working group