Senate Finance Committee Chairman Max Baucus (D-Mont.) June 16 introduced a new substitute amendment (S. Amdt. 4369) to the tax extenders bill (H.R. 4213) that would further soften a tax increase on investment fund managers and would ease administrative concerns regarding new rules for S corporations.

Baucus’s new substitute amendment to the extenders bill was offered just hours after his original proposal (S. Amdt. 4301) garnered only 45 of the 60 votes needed to advance in the Senate.

Senators in both parties criticized the bill’s carried interest provisions, which would tax most of the share of profits that investment fund managers receive at ordinary income tax rates, rather than the much lower capital gains tax rate at which they are currently taxed.

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