Qualified Small Business Stock

The Scoop on Qualified Small Business Stock

About QSBS: Once upon a time Qualified Small Business Stock (QSBS) sat in an ignored corner of the Internal Revenue Code, a lonely tax incentive that nobody wanted to play with — a tax-law ugly duckling.   Then, one day, QSBS turned into a beautiful swan — the perfect tax incentive for your Black Swan Event. QSBS is now arguably the most important incentive for business in the Internal Revenue Code, and is likely to grow even more so under the Biden Administration.  QSBS allows a successful investor to exclude gain up to $10 million, or ten times the basis of the initial investment, so long as the stock and the underlying business meet certain criteria, and the investor holds the QSBS for at least five years. Moreover, each investor can multiply these wealth and tax benefits by making gifts to children, and transfers into trust for children and others. Yes, the benefits are huge. But this area is extraordinarily complicated: qualifying for this extremely attractive incentive can be difficult. And staying in compliance can also be challenging. About the webinar:  This webinar will explore practical ways to create and grow a qualified small business, and sophisticated strategies to maximize tax savings on a later sale.

Topics will include:

1. The basic requirements for issuing qualified small business stock.
2. The holding requirements to maximize tax benefits.
3. Using Code Section 1045 roll-over to stretch the tax benefits if you sell before the initial five-year holding period is met.
4. How large your business can be and still issue "small" business stock.
5. Traps and pitfalls that can cause a business to cease qualifying for QSBS benefits.

Register now to join Jay and his Panel on Wednesday, March 24, 4-5:30pm. Jay Darby's Tax Briefings are deep, sophisticated — and always entertaining.  You're also welcome to stay for the Q&A Session and "Social Half Hour" afterwards.