By Richard Morris, Partner, Herrick Feinstein L.L.P. The IRS has proposed rules reclassify how private equity executives’ management fees are taxed. Under the rules, firms will find it harder to convert their fees — which are taxed at high rates — into carried interest. Many don’t realize that this will have a large effect on the commercial real estate industry specifically investment structures. The proposed amendment to the Internal Revenue Code would significantly increase the tax obligations of real estate fund managers and certain other fund professionals. In general, the amendment requires that income attributable to carried interest in a…