QSBS is popping up more and more these days, whether in M&A transactions, IPOs, regulatory changes, politics, entrepreneurship and in many more areas. Here are some of the recent developments we are following.
Illinois Becomes The Most Recent State to Decouple From QSBS Post-OBBBA (7/13/2026) - Illinois has officially changed its treatment of Qualified Small Business Stock (QSBS), marking an important development for founders, investors, and business owners with Illinois tax exposure. For years, Illinois generally followed the federal treatment of Section 1202, meaning taxpayers who qualified for the federal QSBS exclusion could often exclude the same gain for Illinois income… Read More
Protecting QSBS Value: Why Ongoing Active Business Compliance Matters (7/13/2026) - A recent article by Joe Wallin on The Startup Law Blog highlights an important point that many founders and investors overlook: reaching the five-year QSBS mark does not lock the tax benefit in place. As Wallin explains, the active business requirement continues for "substantially all" of the shareholders’ holding period, which means companies need to… Read More
Wall Street Journal Highlights IRS Scrutiny on “Trust Stacking” to Multiple QSBS Benefits (6/29/2026) - A tax planning strategy that has become increasingly popular among startup founders and venture investors is now squarely in the crosshairs of the U.S. Treasury Department and the IRS. According to a new Wall Street Journal report, federal officials are preparing guidance aimed at limiting "trust stacking"—a strategy used to multiply the tax benefits available… Read More
Why More Business Owners Are Paying Attention to QSBS (6/18/2026) - Qualified Small Business Stock (QSBS) has evolved from a niche tax incentive primarily associated with venture-backed startups into a planning opportunity being considered by business owners across a variety of industries. Ben Steverman's recent Bloomberg article highlights the growing popularity of Section 1202 and the increasing number of founders, investors, and business owners exploring its… Read More
Forbes Highlights Growing QSBS Opportunity for Creator-Led Companies (6/10/2026) - Many artists are no longer just generating income; they are building valuable businesses. As creator-led brands continue to grow, Qualified Small Business Stock (QSBS) may offer significant tax benefits for founders who plan early. Here's what music entrepreneurs need to know before they build. Read More
Treasury’s Coming QSBS Crackdown Puts Trust Stacking in the Spotlight (6/3/2026) - Forthcoming IRS regulations may focus on the use of trusts to multiply or "stack" the QSBS benefit. Read More
Treasury’s Next QSBS Rules Could Redraw the Boundaries of the Tax Break (5/12/2026) - Treasury is “working diligently” on regulations tied to the Qualified Small Business Stock (QSBS) gain exclusion under Section 1202, according to Bloomberg Tax. Treasury attorney-adviser Evan Adams said at the American Bar Association Tax Section’s May meeting that both the scope and timing of the project remain “in flux,” and that Treasury is looking not… Read More
Issuer-Based QSBS Certification Gains Attention (4/29/2026) - A recent Tax Notes piece by Manoj Viswanathan of the University of California College of the Law, San Francisco argues that the current system for claiming the Qualified Small Business Stock exclusion places too much responsibility on the wrong party. Rather than requiring shareholders to prove Section 1202 eligibility years after stock is issued, he… Read More
Why S Corporation History Matters for QSBS Claims (4/20/2026) - Qualified Small Business Stock is often described as one of the most powerful tax incentives available to founders and early-stage investors. But as a recent FBT Gibbons article by Scott W. Dolson makes clear, Section 1202 planning can become far more complicated when a corporation has any S corporation history. In an environment where the… Read More
Redemption Rules Continue to Snare QSBS Hopefuls (4/16/2026) - A recent article by Scott Robert Buzzard, Christopher Steele Brown, and Mark A. Melton of Holland & Knight highlights a persistent risk in the world of Qualified Small Business Stock (QSBS): stock redemption rules that can quietly undermine eligibility for one of the tax code’s most valuable benefits. As interest in QSBS continues to grow—fueled… Read MoreGet in Touch
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