Rep. Richard Neal (D-MA-1): Over $1.6M in Financial Industry Donations While He Shelved Carried Interest Reform

Rep. Richard Neal (D-MA-1) has represented western Massachusetts in Congress since 1989. He chairs — or has ranked on — the House Ways and Means Committee, the body that writes all federal tax legislation, for more than a decade. During that time he received over $1.6 million in career contributions from the securities and investment industry. That same industry’s signature tax advantage, known as the “carried interest” loophole, survived every major tax reform debate that passed through his committee.

Who Is Donating

Federal campaign finance data compiled by OpenSecrets documents the scale of Neal’s ties to the financial sector. By the 2020 election cycle, the securities and investment industry and the related real estate sector had contributed nearly $500,000 to his campaign in that cycle alone. His top donors in recent cycles have included Blackstone and Capital Group — two of the largest private equity and investment management firms in the country, both direct beneficiaries of the carried interest tax preference.

In the 2020 election cycle, Neal received nearly $2.9 million in total corporate PAC contributions — more than any other House member that year.

The carried interest loophole allows fund managers to treat fees earned from managing clients’ money as long-term capital gains, taxed at 15–20%, rather than as ordinary income, taxed at up to 37%. Critics across the political spectrum, including Presidents Obama, Trump, and Biden, have called for closing it. The loophole primarily benefits the private equity and hedge fund managers who figure prominently in Neal’s donor list.

The Carried Interest Timeline

The relationship between Neal’s donor profile and his position on carried interest reform follows a specific and documented arc.

In 2007, Neal was an original cosponsor of legislation to eliminate the loophole. Beginning in 2008, records show a sharp increase in donations to his campaign from the securities and investment industry. In the 2015 and 2017 congressional sessions, Neal did not cosponsor the reform bill he had previously backed. In 2017, he worked alongside Ways and Means Chairman Kevin Brady (R-TX), and the Tax Cuts and Jobs Act left the loophole intact.

When Democrats retook the House in 2019 and Neal became Ways and Means chairman, closing the carried interest loophole was widely expected to be part of the Democratic reconciliation agenda. When his committee released its reconciliation proposal in 2021, the loophole was not addressed. A committee spokesperson explained to Slate that they “did not believe it could pass the House” — even as Senate Finance Committee Chairman Ron Wyden introduced legislation that session to close it, and President Biden publicly called for its elimination.

The loophole remained intact.

Tax Filing and the Intuit Connection

A separate documented pattern emerged in 2019 around free tax filing. ProPublica reported that as the House Ways and Means Committee was advancing the Taxpayer First Act, an early version of the bill included a provision that would have made it illegal for the IRS to create its own free online filing system — permanently locking Americans into industry-run programs. That specific provision was removed before the bill passed into law, but the attempt drew attention to Neal’s financial ties to the industry pushing for it: he had received $16,000 in contributions from Intuit (maker of TurboTax) and H&R Block. Intuit alone spent $2.6 million on lobbying in 2018, with the IRS filing arrangement among its stated lobbying priorities. The industry-run free filing programs exist but are rarely used: ProPublica reported that while 70% of American taxpayers are eligible to file for free through those programs, only 3% did so.

The Son’s Lobbying Firm

In October 2024, Politico published an investigation finding that Brendan Neal — the congressman’s son — had launched a one-person public affairs firm offering “political advice, lobbying and strategic communications” in 2020, approximately one year after his father became the ranking member of Ways and Means. Since then, Brendan Neal received $196,340 from his father’s campaign committee for “strategic consulting services.”

According to Politico’s reporting, Brendan Neal also received at least $20,000 from Van Heuvelen Strategies, a lobbying firm with active interests in at least six issues before the Ways and Means Committee, and $252,500 from a client of a lobbyist who was simultaneously working for Blackstone — a top donor to Richard Neal’s campaign — to preserve the carried interest loophole.

Richard Neal and Brendan Neal both denied any impropriety. Neal’s office stated that Brendan “has never lobbied Congressman Neal’s office or Ways and Means Committee.” Neal’s political opponent at the time called for a House Ethics Committee investigation; as of this writing, no formal investigation was announced.

What This Costs Constituents

The carried interest loophole benefits a narrow class of investment fund managers. Western Massachusetts — the district Neal has represented since 1989 — is not a hub of private equity. The district includes the cities of Springfield and Pittsfield, communities anchored by healthcare, manufacturing, and education employment.

The tax filing issue is more direct: Americans who cannot find or use the industry-run free filing programs pay $50–$200 annually for commercial tax preparation. The burden falls heaviest on lower-income filers who meet the income threshold for free filing but are funneled toward paid products.

What You Can Do

Rep. Neal is running in the September 2026 Democratic primary for Massachusetts’ 1st Congressional District. Voters can review candidate platforms through the League of Women Voters’ voter guide and check registration deadlines at vote.org. To contact your own members of Congress about carried interest tax reform or ethics disclosure rules, visit our take action page.