On Sept. 6, the carried interest tax loophole took center stage, featuring a four-panel, 20-witness marathon hearing in the House Ways and Means Committee and the third hearing this year on the topic in the Senate Finance Committee. The day before the hearings, over 300 national, state and local nonprofit organizations sent a letter to Congress urging it to close the loophole in order to bring equity to the tax code.

Congress's tax-writing committees have focused increasing attention this summer on a hitherto little-noticed tax preference enjoyed by private equity and other fund managers that allows them to pay capital gains rates (15 percent) on "carried interest" income they are paid to manage investment funds they do not own. This is significantly lower than the income tax rate that would otherwise be assessed, which could be as high as 35 percent. As Congress moves to take action to close this loophole, nonprofit advocacy groups are mobilizing to support a fix to this unfair aspect of the tax code.

On July 19, the Senate Finance Committee approved a proposal to expand coverage of the State Children's Health Insurance Program (SCHIP) to four million additional children who would otherwise not have health insurance. The entire Senate is expected to vote on the proposal this week (July 24-27), while the House is expected to act soon to approve legislation providing insurance for even more children than the Senate's version. The president has threatened to veto the Senate Finance Committee-approved version, even though it cleared the committee with strong bipartisan support, 17-4.

After decades of flying below the radar screen, a tax policy allowing private equity fund managers to claim their fee-based income as capital gains rather than ordinary income has suddenly become the subject of media scrutiny, congressional hearings and legislation. In June, the Blackstone Group, a large private equity firm, went public with an initial public offering, which resulted in billion-dollar profits for the principals. This triggered House Ways & Means Committee and Senate Finance Committee chairs Rep. Charles Rangel (D-NY) and Sen.