Denham Capital Seeks to Revive Self-Employment Tax Exemption

Denham Capital Management LP asked a federal appeals court to allow the firm to shield its limited partners’ earnings from self-employment taxes.

Denham, which advises private equity funds that invest in the energy sector, sued the IRS for increasing its net earnings from self-employment from $3.17 million to $53.6 million for 2016 and 2017. The US Tax Court sided with the agency in December, finding Denham’s partners weren’t exempt from paying Medicare and Social Security contributions because their actions exceeded the management responsibilities of a passive investor.

• Denham’s April 11 appeal to the US Court of Appeals for the First ...