Qualified Small Business Stock (QSBS)
A tax rule that can let you avoid federal tax on some or all of your gains when you sell stock in an eligible small company you've held for over five years.
Quick Answer
What are the basic requirements for stock to qualify as QSBS?
The issuing company must be a domestic C-corporation with gross assets under $50 million at issuance, engaged in a qualifying active trade, and the stock must be held for more than five years before sale.
- Only C-corporation stock can qualify, not LLCs or S-corps
- The five-year holding period has no exceptions for partial credit
- Certain business types are statutorily excluded from eligibility
The Lovie Advantage
Lovie flags QSBS eligibility and holding-period milestones directly against your formation date and stock issuance records.
See how this connects to Lovie Formation. For the formal definition, see Delaware's Division of Corporations.
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