A Section 1202 Primer: The Qualified Small Business Stock Gain Exclusion

OL1347  |  On Demand Course  |  Update  |  Self-Study

Description

Section 1202 provides for a 100% exclusion from federal income tax when qualified small business stock ("QSBS") held for more than five years is sold in a taxable sale, subject to a gain exclusion cap of $10 million per stockholder per issuing corporation or, if greater, 10 times the aggregate tax basis of the QSBS held by the selling stockholder. If the Section 1202 gain exclusion applies to the taxable sale of QSBS issued after September 27, 2010, there is no capital gains tax, no 3.8% net investment income tax and no alternative minimum tax. This session will cover the issuer-level and shareholder-level requirements under Section 1202, including the specific types of businesses that are excluded from qualification, and how these requirements impact the applicability of the exclusion. Attendees will learn how to effectively advise clients on structuring investments to maximize the benefits of Section 1202, including strategic planning for holding periods and the use of Section 1045 as a helpful tool. The presentation will also explore case studies.

This course is part of the 2024 Tennessee Federal Tax Conference Bundle. Purchase the conference bundle here.

Credits

Number of Credits Type of Credits
1.00 Taxes

Prices

Member (Early Bird)
$49.00
Non-Member (Early Bird)
$79.00
Member
$49.00
Non-Member
$79.00
Your Price: $79.00

This is your base price and does not reflect any additional session fees, optional add-ons, or guest registrations.

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Instructors

Scott W. Dolson, JD

Scott is the leader of Frost Brown Todd's tax planning team and co-chair of the firm's private equity industry team. The scope of Scott's tax practice encompasses tax planning for business formations, ownership arrangements, LLC agreements and M&A transactions. Scott's corporate practice extends to handling M&A transactions, equity compensation arrangements and general corporate law matters.

Scott is recognized for his tax planning work with founders, investors, and businesses with respect to their qualified small business stock (QSBS) issues. Scott has written numerous articles addressing QSBS planning issues, and he has developed a national practice handling Section 1202 and 1045 issues. Scott's focus is on securing and maximizing Section 1202's generous tax benefits for his clients.

Scott has represented companies, founders, investors, management teams, executives, PE sponsors, family offices and individuals across a wide variety of industries, including healthcare, direct marketing, gaming, industrial and commercial real estate development, distributorship, software and hospitality. Scott applies his expertise and experience to assist clients in achieving their business objectives, whether that means limiting an exposure to contingent liabilities or finding the most tax efficient structure for a business transaction.

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Brian S. Masterson, JD, LLM, CPA

Brian is a member of the Tax Practice Group at Frost Brown Todd. He concentrates his practice on tax planning and tax controversies, mergers and acquisitions, and joint ventures. In addition, Brian has recently focused a significant amount of his practice on advising clients with respect to establishing Opportunity Zone Funds and Qualified Opportunity Zone Businesses.

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