QSBS Related Tax Code Sections

QSBS Court Ruling: Owen v. Commissioner of Internal Revenue-Why is an “active business” requirement under (§1202(e)) important when applying a §1045?

United States Tax Court, Nos. 930–07, 1384–07, 13303–07, 29011–08, 29090–08, January 19, 2012 KEY QSBS TAKEAWAY(S): In Owen v. Commissioner, the taxpayer met the 60–day requirement of section 1045(a)(1) because the stock purchase agreement transaction was signed on June 17, 2002, and the sold Family First Companies shares--amounting to … Read More

Section 368

(a) Reorganization (1) In general For purposes of parts I and II and this part, the term “reorganization” means— (A) a statutory merger or consolidation; (B) the acquisition by one corporation, in exchange solely for all or a part of its voting stock (or in exchange solely for all or a … Read More

Section 351

(a) General rule No gain or loss shall be recognized if property is transferred to a corporation by one or more persons solely in exchange for stock in such corporation and immediately after the exchange such person or persons are in control (as defined in section 368(c)) of the corporation. (b) … Read More

Section 1045 Application To Partnerships

§ 1.1045-1 Application to partnerships. (a) Overview of section.  A partnership that holds qualified small business stock (QSB stock) (as defined in paragraph (g)(1) of this section) for more than 6 months, sells such QSB stock, and purchases replacement QSB stock (as defined in paragraph (g)(2) of this section) may elect to apply section 1045. An eligible partner (as defined in paragraph (g)(3) of this section) of a partnership that sells QSB stock, may elect to apply section 1045 … Read More

Code Section 613

(a)General rule In the case of the mines, wells, and other natural deposits listed in subsection (b), the allowance for depletion under section 611 shall be the percentage, specified in subsection (b), of the gross income from the property excluding from such gross income an amount equal to any rents or … Read More

Code Section 1411

(a)In general Except as provided in subsection (e)— (1)Application to individuals In the case of an individual, there is hereby imposed (in addition to any other tax imposed by this subtitle) for each taxable year a tax equal to 3.8 percent of the lesser of— (A) net investment income for such taxable … Read More

Code Section 304(a)

(a)Treatment of certain stock purchases (1)Acquisition by related corporation (other than subsidiary) For purposes of sections 302 and 303, if— (A)one or more persons are in control of each of two corporations, and (B)in return for property, one of the corporations acquires stock in the other corporation from the person (or persons) so in control,then (unless paragraph … Read More