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Do Fund Partners Typically Receive Salary as W2 Employees, Partnership Distributions, or 1099 Contractors?

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Community Member
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May 03, 2023
Is it customary for fund partners to receive salary as a W2 employee as a partnership distribution from the LLC or as a 1099 contractor?
1 answer
Community Member
Accepted Answer
May 03, 2023
For small funds, the managers frequently take distributions and do not get paid as either an employee or as a contractor. Only when the fund sizes are above $20 MM do managers start looking at salaries, and the salaries are reserved for junior team members without carry.

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