What is a QSBS exemption and would my C-Corp qualify?
The Qualified Small Business Stock exemption allows a C-Corp's stockholders to write off 100% of personal taxes on gains from the sale of the stock over its original purchase price after five years of ownership. The maximum write-off is $10,000,000 or 10 times the aggregate adjusted basis of the QSBS stock (whichever is higher).
The potential tax break on a successful exit with QSBS is massive, and virtually all newly-incorporated, high-growth US C-Corp startups would meet the requirements: the QSBS exemption can apply to stock issued by an active, domestic C-Corporation with less than $50,000,000 in assets.
Read S-Corps, LLCs, and Tax Savings for Startups. If you have any questions about the QSBS or if your company qualifies, consult your tax advisor.
Last updated on January 17, 2018