Despite some improvement, the private equity folks are having some problems. Just take a look at the implosion of deals like Harman (NYSE: HAR). And, of course, major Wall Street banks are taking massive write-offs for problematic buyout loans.

Oh, and there's something else; that is, private equity firms also must deal with a possible tax hike. In fact, Senator Charles Schumer plans to introduce a bill on the matter according to Bloomberg.

Even if dealmaking slows down, a private equity surcharge could be a nice source of revenues. With current rates at only 15%, there is certainly lots of opportunity for Congress to soak.

Interestingly enough, Schumer is not too optimistic about his bill. That is, he thinks that President Bush will use his veto pen.

But, I have a feeling the tax issue won't go away. Simply put, it's just too big to ignore. And, no doubt, I'm sure private equity heavies are paying some big bucks for their tax advisers to gin up some creative strategies.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.