Lawyers on Tap: Tap Tips for Entity Formation and Taxation
Corporate Law Report: Workplace Romances, FMLA Changes, California Tax News, and More
Since the finalization of the IRS’s “check-the-box” entity-classification regulations nearly 30 years ago, a state law LLC can elect to be taxed an association taxable as a corporation. During the past month, we have heard...more
In startups and early-stage companies, founders often receive restricted equity grants as compensation for their services. With some planning, founders can potentially lower the taxes they pay on the appreciation of the...more
This article provides general information regarding U.S. federal income tax incentives available to non-corporate holders of “qualified small business stock” (“QSB stock”) as defined under Section 1202 of the Internal Revenue...more
On March 20, 2025, New Jersey lawmakers advanced a measure that would bring the New Jersey Gross Income Tax into closer conformity with federal law regarding the income tax treatment of “qualified small business stock,” or...more
The “qualified small business stock” (QSBS) tax exemption under Section 1202 allows non-corporate founders and investors in certain emerging growth companies to potentially exclude up to 100 percent of the U.S. federal...more
Many non-US startup founders initially incorporate in their home country and then decide to reincorporate or create a subsidiary in the US. There are many advantages for foreign founders to move operations to the US,...more
As a founder, deciding whether to organize your business as a corporation or a limited liability company (LLC) is a crucial first step. Corporations are often favored for their ability to attract venture capital and offer...more
Internal Revenue Code (IRC) Section 1202 offers a significant tax incentive for investors in qualified small business stock (QSBS). This provision allows eligible shareholders to exclude up to 100% of capital gains realized...more
This presentation will cover essential aspects of QSBS eligibility, the tax benefits available under Section 1202, and practical approaches for maximizing exclusions on capital gains. This session will include recent updates,...more
Founders, entrepreneurs, venture capitalists and other investors (all of which are collectively referred to herein as “investors”) should be familiar with Internal Revenue Code Section 1202, a valuable provision that...more
In recent years, the utilization of qualified small business stock (“QSBS”) has grown considerably. Many businesses are formed as corporations at conception, private equity investors calculate the tax benefits from Section...more
The “qualified small business stock” (QSBS) tax exemption under Section 1202 of the Internal Revenue Code allows non-corporate founders and investors in certain emerging growth companies organized as corporations to...more
Search Funds should consider the availability of the tax benefits of Section 1202 in connection with their acquisitions. The upside, if properly structured, can be significant. Section 1202 has gained popularity likely due to...more
If you own a small business, you may qualify for significant tax savings under section 1202 of the Internal Revenue Code of 1986, as amended (Section 1202). Owners or investors of certain C corporations (C corps) may be...more
Corporate Partner, Eric Perlmutter-Gumbiner, shared his expertise on latest developments and trends in the business of beauty, fashion, and consumer goods with Los Angeles Times in their Beauty, Fashion & Consumer Goods...more
Today, many business owners are aware of qualified small business stock (“QSBS”) and the exclusion from gain on certain sales of QSBS under §1202, but it is still common to encounter business owners who are either unaware of...more
This is the second of a four-part series focusing on estate planning fundamentals for founders. This article will address an important topic for owners of Qualified Small Business Stock (QSBS) as defined in Section 1202 of...more
For an active business in the post-Tax Cuts and Jobs Act (TCJA) world of lower corporate tax rates, buyers and shareholders considering a future exit should always consider C corporations and the availability of potential...more
The number of taxpayers seeking the benefits of Qualified Small Business Stock (“QSBS”) has picked up steam in recent years, particularly since the Tax Cuts and Jobs Act (“TCJA”) lowered the federal corporate tax rates to...more
In Leto v. United States, the taxpayer reincorporated an S corporation business into a C corporation, then the taxpayer later sold the shares in the C corporation and tried to exclude the gain from such sale under section...more
Qualified Small Business Stock (“QSBS”) is arguably one of the largest “gifts” Congress has given taxpayers by excluding from a shareholder’s gross income the greater of $10 million or 10 times the shareholder’s basis in the...more
Thinking about investing in a young, promising company? Section 1202 of the tax code offers a significant incentive for individuals to do just that....more
The Qualified Small Business Stock (QSBS) status under Section 1202 of the Internal Revenue Code provides a significant tax advantage for small business owners (i.e., Founders) and investors. It allows for a 100% capital gain...more
Section 1202 provides a significant incentive for taxpayers to invest in small businesses structured as C corporations by allowing them to exclude large amounts of gain on a future sale of stock in those businesses. ...more
Most founders are familiar with Section 1202 of the Internal Revenue Code, which provides a tax exemption for the sale of Qualified Small Business Stock (QSBS). Less well known is Section 1202's cousin, Section 1045, which...more