QSBS Tax Strategies
Last updated
Last updated
. The QSBS tax exemption can allow you to exclude 100% of capital gains (up to $10 million; perhaps more). But you must meet a large number or criteria.
. If you own options in a company about to disqualify for QSBS, exercising your options before this event allows the purchased shares to qualify for preferential QSBS Treatment.
. Gifting QSBS stock and/or utilizing irrevocable trusts can allow you to multiply the QSBS tax exclusion well beyond $10 million.
. Investing more than $1mm in a QSBS eligible company enables a QSBS exclusion above $10mm via the 10x rule. Property can also be invested (vs. cash), which increases strategic options.
. If your QSBS is sold before meeting the 5-year holding period, you can consider rolling the gains into a new QSBS investment using a 1045 exchange to maintain QSBS eligibility.
In addition to the above QSBS tax strategies, a number of other tax strategies may also apply in certain situations. We encourage you to review all of the strategies detailed on the page to ensure you have the proverbial "full menu" of tax planning strategies to consider for your situation.