Taking Private Funds Retail, RIC Qualification, and Dual Share Class Structures – Regulatory and Tax Issues

Leila E. Vaughan, Partner | Faegre Drinker Biddle & Reath LLP

Leila Vaughan is a partner in the Philadelphia office of Faegre Drinker Biddle & Reath LLP, where she counsels investment management clients on investment tax matters. Her practice centers on private equity funds, regulated investment companies, hedge funds, lending funds, and real estate investment funds, and covers the tax dimensions of fund structuring and formation, portfolio investments, RIC compliance, and fund mergers and liquidations. She also works on mergers and acquisitions, tax-free reorganizations and spinoffs, nonprofit matters, and qualified opportunity funds.

• Education & Credentials

Leila earned her LL.M. in Taxation from New York University (2010), her J.D. from the University of Pennsylvania Law School (2006), where she served as a senior editor of the University of Pennsylvania Law Review, and her B.A. in Political Science from Duke University (2003), where she was a member of Pi Sigma Alpha. She is admitted to the bars of the District of Columbia and Pennsylvania and to the U.S. District Court for the Eastern District of Pennsylvania.

• Recognition & Leadership

Leila has been recognized by Best Lawyers® as one of its “Ones to Watch” in Tax Law (2024–25) and has been named to Faegre Drinker’s Pro Bono Honor Roll (2024–25).

• Professional Involvement

Leila serves as Vice Chair of the Investment Management Committee of the American Bar Association’s Section of Taxation (2024–present). She speaks regularly on fund taxation, including a May 2026 ABA Tax Section panel on current tax trends in registered funds and other retail-focused vehicles, and prior programs for the Pennsylvania Bar Institute, the Federal Bar Association Tax Law Conference, and the Philadelphia Bar Association. Her recent publications include two April 2026 Private Equity Law Report articles on the mechanics, tax treatment, and post-conversion compliance complications of private fund conversions to registered funds, and she is a co-author of BNA Tax Management Portfolios on partnership formation and choice of entity.

• Experience

Leila rejoined Faegre Drinker as an investment management partner in 2022. She previously practiced at the firm as a tax associate, advising clients on the taxation of mutual funds and hedge funds, providing tax advice to investment company clients on reorganizations, liquidations, and disclosures, and negotiating the tax aspects of mergers and acquisitions and credit agreements. Her recent work includes the firm’s February 2026 representation of The RBB Fund in its dual share class structure.

Jillian L. Bosmann, Partner | Faegre Drinker Biddle & Reath LLP

Jillian L. Bosmann is a partner in the Philadelphia office of Faegre Drinker Biddle & Reath LLP, where she advises investment companies, investment advisers, and fund boards on the legal, regulatory, and compliance issues that arise throughout the lifecycle of investment funds. Her practice focuses on supporting new product development, advising advisers on fiduciary obligations, and helping fund boards implement effective governance and risk management practices. Jillian regularly counsels clients on matters arising under the federal securities laws, including the Investment Company Act of 1940 and the Investment Advisers Act of 1940.

• Education & Credentials

Jillian earned her Juris Doctor from Cornell Law School in 2006 and her Bachelor of Arts from Carleton College in 2001. She is admitted to practice in Pennsylvania and concentrates her practice on investment management, investment company regulation, and securities law.

• Recognition & Leadership

Jillian was recognized as a Next Generation Lawyer by The Legal 500 from 2017 through 2019 for her work in investment management. She was elected to the partnership at Faegre Drinker in 2017 and is recognized for advising investment advisers and fund boards on complex regulatory, fiduciary, and governance matters involving registered investment companies.

• Professional Involvement

Jillian regularly serves as fund counsel to registered investment companies and advises independent fund directors on corporate governance, fiduciary responsibilities, regulatory compliance, and risk management. She counsels clients on SEC examinations, regulatory filings, exemptive applications, ESG investment products, and the development and implementation of compliance programs under the federal securities laws. Her work also includes advising on innovative fund structures and navigating evolving regulatory requirements affecting the investment management industry.

• Experience

Jillian advises mutual funds, ETFs, closed-end funds, interval funds, business development companies, and investment advisers on regulatory, compliance, and governance matters under the federal securities laws. Her experience includes fund formation, reorganizations, ETF conversions, SEC compliance, ESG products, exemptive relief, and advising fund boards and advisers on fiduciary duties and risk management. She also recently advised The RBB Fund on its February 2026 dual share class structure.

SESSION 1 – Converting Private Funds to Registered Funds: Mechanics, Tax Treatment, and Structuring the Transaction | 2:30pm – 3:30pm

Private fund sponsors are moving into registered products at record pace, and the conversion transaction sits at the intersection of partnership tax, corporate tax, and the Investment Company Act. This session walks through the available conversion paths, the tax treatment of each, and the structuring decisions that determine whether legacy investors take a tax hit on the way in.

BREAK | 3:30pm – 3:40pm

SESSION 2 – RIC Tax Compliance for Alternative Assets and the Growth of Dual Share Class Structures | 3:40pm – 4:40pm

Once the fund is registered, Subchapter M does not bend for alternative strategies. This session covers the quarterly asset diversification and gross income tests as applied to private credit, pre-IPO equity, and other alternative holdings — including concentration problems created by appreciating positions — plus distribution requirements, excise tax planning, and the tax mechanics of the new dual share class (ETF class) structures.