Republican Lawmaker Defends Carried-Interest Tax Break Amid Billion-Dollar Hedge-Fund Support

In 2025, Representative Ashley Hinson (R-IA) joined a group of Republican House members in a letter to Ways and Means Committee Chairman Jason Smith (R-MO), urging him to preserve the carried-interest tax provision exactly as it stands. The House Ways and Means Committee ultimately rejected a proposal to close the loophole, leaving the preferential capital-gains treatment intact.

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The carried-interest loophole allows private-equity managers to treat the majority of their earnings—the “carry” from a 2-and-20 fee structure—as long-term capital gains, taxed at a lower rate than ordinary income. Presidents Barack Obama, Joe Biden and Donald Trump each advocated eliminating the break, calling it an unfair tax advantage for the wealthy. In 2017, after lobbying, Congress altered the rule only by extending the required holding period for assets from one to three years, leaving the lower tax rate largely unchanged.

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• The Congressional Budget Office projected that fully closing the loophole would generate roughly $13 billion in revenue over ten years.

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• Iowa’s financial-services sector employs about 95,000 workers, according to the state economic development authority.

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• Ken Griffin, founder of Citadel, has contributed $40 million to Republican candidates in the current cycle, including $10 million to the Senate Leadership Fund that runs ads supporting Hinson.

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• The super-PAC Fight On Iowa has raised $1.77 million for Hinson’s Senate bid, with $1.5 million coming from Griffin alone.

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• Hinson’s campaign finance records show she has received more than $1 million from individuals and PACs tied to the securities and investment industry across three prior elections, plus $30,000 from Apollo Global Management CEO Marc Rowan and $26,500 from Blackstone co-founder Stephen Schwarzman.

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Committee Chairman Jason Smith said all policy options regarding the carried-interest provision were “on the table,” indicating openness to reform but no commitment to change.

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Tax scholars, surveyed by Professor Choi, reported overwhelming agreement—147 of 157 respondents— that carried interest should be taxed as ordinary income, describing the issue as the single policy with the strongest consensus among tax experts.

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Critics note that the primary beneficiaries of the loophole are high-level private-equity managers rather than small businesses or the middle class. The United Kingdom eliminated its preferential treatment for similar investments this year, contradicting Hinson’s claim that the U.S. risks losing global competitiveness. Iowa observers also point to Hinson’s husband’s ownership of $1 million–$5 million in stock of High Street Insurers, a subsidiary of private-equity firm Huron Capital, raising questions about potential conflicts of interest.

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• “Ashley Hinson possesses the experience, commitment, and integrity to deliver results for Iowa’s families and communities,” — Ken Griffin

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Hinson is now campaigning for the U.S. Senate seat vacated by retiring Senator Joni Ernst. Her alignment with the carried-interest provision is expected to remain a focal point for both supporters and opponents as the race progresses.

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