Purchasing existing stock or assets in a company does not qualify as qualified small business stock (QSBS). QSBS has to be newly issued stock and qualify as a Section 1202 qualified small business. Refer here for details on what constitutes a qualified small business. Section 1202 of the … Read More
As a investor in an investment fund, it is imperative to know what the tax implications may be for when you receive your pass-through distributions from the investment fund. QSBSExpert is here to help! What Businesses Qualify for QSBS?Can My QSBS Gain(s) Be Excluded from Taxes?What are the … Read More
As a manager of an Investment Fund, it is imperative to know both what the tax implications may be for investments you’re considering entering and tax treatment of gains for your Limited Partners as they are sure to ask you. QSBSExpert is here to help! Which Portfolio Companies … Read More
A tiered partnership involves an upper-tier, the parent or holding company, and a lower-tier, the subsidiary. Generally, the partners of the parent company will have pass-through income or losses from the subsidiary that passes through the parent. For tax purposes, the partners of the parent company are … Read More
Partnerships can elect the Section 1045 rollover, but there are some nuances between various situations in terms of who has the authority to purchase replacement QSBS. The IRS has laid out detailed guidelines over the treatment of the Section 1045 rollover for partnerships. The guidelines are summarized … Read More
Under Section 1202(a)(1) QSBS can be owned by any entity other than a C Corporation. Therefore, a trust, S Corporation, Partnership, or individual can own QSBS. The share gain of the gain received in the sale of QSBS can not exceed the interest that the shareholder, partner, … Read More
Venture Capital (VC) funds can elect the Section 1045 rollover, but there are some nuances between various situations. VC funds are structured as partnerships; therefore, the Section 1045 treatment will be parallel with most partnership structures. The IRS has laid out detailed guidelines over the treatment of … Read More
For purposes of this article, we are referring to General Partners of venture capital (VC) firms or similar private equity investment funds. General Partners can accumulate capital gains from two main sources, i.e. (i) direct investments or (ii) carried interest. Generally, General Partners of VC firms will … Read More
Individuals and pass-through entities are considered eligible investors for QSBS purposes. Venture Capital (VC) firms are formed under a limited liability partnership (LLP) legal structure, which is a pass-through entity. Therefore, limited partners (investors) in a VC firm will be able to take advantage of the Section … Read More