Does my stock qualify for QSBS?

A qualified small business stock (QSBS) is any stock acquired from a QSB after Aug. 10, 1993. The investor must have held the stock for at least five years. At least 80% of the issuing corporation’s assets must be used in the operations of one or more of its qualified trades or businesses.

Does QSBS apply to carried interest?

Carried Interest. 1202 states that a partnership interest must be held both on the date the partnership acquired the QSBS stock and through the date of sale in order to qualify.

When to roll over qualified small business stock?

For questions regarding the QSBS regime or the qualified rollover rules, please contact a member of the Tax Services Group. The tax code allows taxpayers to sell QSBS and to defer capital gain on the sale if they roll the sales proceeds into replacement QSBS within 60 days of the sale.

What happens to qsbs in a qualified rollover?

If the qualified rollover rules apply, then the taxpayer takes a basis and holding period in the replacement QSBS that is determined by reference to the QSBS sold, thus preserving the built-in gain and applicable exclusion percentage of the original QSBS.

When to roll qsbs into a capital gain?

The tax code allows taxpayers to sell QSBS and to defer capital gain on the sale if they roll the sales proceeds into replacement QSBS within 60 days of the sale. This allows for the deferral of existing and future capital gain on the sale of the replacement QSBS. The main requirements for a qualified rollover are as follows:

When do I have to reinvest my qsbs?

The taxpayer must own the original QSBS for more than 6 months before its sale, without taking into account any carryover (or tacked) holding period that may apply. The taxpayer must reinvest the entire sales proceeds (not just gain) in replacement QSBS within 60 days of the sale.