Lawyers on Tap: Tap Tips for Entity Formation and Taxation
Corporate Law Report: Workplace Romances, FMLA Changes, California Tax News, and 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
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
In the event of an M&A transaction, many stockholders plan to take advantage of the exclusion from federal taxable income of gain realized from the sale or exchange of “qualified small business stock” (QSB stock). Section...more
Our Federal Tax Group highlights a rule that exempts certain small business stock sales from taxes. What kinds of small companies are ideal candidates for qualified small business stock (QSBS) gain exclusions?...more
Are your shareholders leaving money on the table? Certain tax planning strategies, much like magic spells in the Wizarding World of Harry Potter, require some pre-ordained incantations in order to bring them to life. The...more
Henry Hobson is a widowed blowhard who fancies himself superior to everyone because he owns a shoe business. Hobson’s daughter Maggie actually runs the business, but Hobson does not pay her....more
Section 1202 of the Internal Revenue Code provides savvy business founders and investors an opportunity for large tax savings. In fact, if the entity and the business exit are structured correctly, upon an exit, the founders...more
A brief commentary on the past week’s cases, rulings, notices, and related federal tax guidance. Medical Software Deemed a Qualifying Trade for Qualified Small Business Stock Gain Exclusion When certain criteria are met,...more
...The federal tax laws are certainly about to change. With the need to raise revenue as a top priority for the Biden Administration, everyone is expecting dramatic changes to the Internal Revenue Code. Tax legislation is...more
On September 15, 2021, the House Ways and Means Committee approved its draft tax legislation that was released on September 13, 2021, as part of the “Build Back Better” budget reconciliation program. Included in the draft...more
The House Ways and Means Committee advanced key tax reform proposals on September 15 that would increase taxes for corporations and high-income individuals. Several tax reform proposals are under consideration as part of...more
Last week, the House Ways and Means Committee announced its consideration of federal tax legislative proposals that include reducing the exclusion from income of gain on the sale of qualified small business stock (QSBS) and...more
First Step- Last Wednesday, the House Ways and Means Committee approved that portion of the 2022 budget legislation with which it was tasked by the Congressional Budget resolution of August 24. The text of the bill...more
Proposal’s Effect Would Limit Access to Capital for Small Businesses - An overlooked provision of the new, sweeping tax bill currently under consideration by Congress as part of President Joe Biden’s $3.5 trillion...more
With the prospect of an increase in capital gain income tax rates looming on the horizon, what could be more welcome than an exclusion of 100% of gain from income? That is exactly what Section 1202 of the Internal Revenue...more
As widely discussed, the Treasury Department released “General Explanations of the Administration’s Fiscal Year 2022 Revenue Proposals,” which includes a potential increase in the long-term capital gains rates for taxpayers...more
A Night to Remember? Did you listen to the President’s speech last Wednesday? He addressed a joint session of Congress to pitch the Administration’s $1.8 trillion American Families Plan. Due to COVID-related...more
If the Democrats Win- Science has not established – at least to my knowledge – any correlation between the pre-election year-end activities of individual business owners, on the one hand, and election outcomes, on the...more
In the excitement of starting a new business, and during the headaches associated with growing that business, many entrepreneurs overlook important details that can have huge impacts on their finances. One large blind spot...more
We receive many questions from founders, investors and others about qualified small business stock. And it’s no wonder, given the complexity of the concept. In this article, we provide a high-level overview of QSBS. A...more
Water, Water Everywhere, Nor Any Drop to Drink- At the beginning of every week, after posting that week’s article, I start to think about a topic for the next post. There are times when I struggle to find something that...more
From time to time, and primarily when the economy is booming, allowing stock options to be “early exercised” - that is, allowing options to be exercised before they are vested - becomes in vogue. We are in one of those times....more
Over the past 25 years, the US tax code has given founders and investors a significant tax break. Taxpayers holding qualified small business stock (“QSBS”) may be able to avoid tax on all or part of their gain from the sale...more
A taxpayer who is considering the sale of certain stock may have the opportunity to exclude or defer part or all of the gain on such sale. To be eligible for the exclusion or deferral, such stock must be “qualified small...more
The Protecting Americans from Tax Hikes Act, passed in December 2015, extended an often overlooked provision of the tax code with the potential to provide significant savings to small business owners and non-corporate...more