Qualified Small-Business Stock rule helps Silicon Valley workers save millions
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Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#2It's not a loophole, it's a specific tax break for people cashing out of "small" businesses. ("small" means at the time you joined -- it can have grown huge since.)
QSBS can save you a lot, but it can be a lot of work to file too. I ran up about $20k in accountant bills doing it on a complex deal.
If you're selling founder or early-employee stock, ask your accountant if QSBS is right for you.
Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#3It's not a loophole, it's a specific tax break for people cashing out of "small" businesses. ("small" means at the time you joined -- it can have grown huge since.) QSBS can save you a lot, but it can be a lot of work to file too. I ran up about $20k in accountant bills doing it on a complex deal. If you're selling founder or early-employee stock, ask your accountant if QSBS is right for you.
Seriously... not a loophole. Explicit tax rule. Just making it look like people are somehow taking advantage of the system. FUD.
Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#4How early of an employee would you need to be?
Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#5It's not a loophole, it's a specific tax break for people cashing out of "small" businesses. ("small" means at the time you joined -- it can have grown huge since.) QSBS can save you a lot, but it can be a lot of work to file too. I ran up about $20k in accountant bills doing it on a complex deal. If you're selling founder or early-employee stock, ask your accountant if QSBS is right for you.
Ok, we've replaced 'loophole' with the name of the thing above.
Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#6How early of an employee would you need to be?
When you join the company needs to be valued less than $50 million (by the article), the price of the actual stock doesn't matter.
Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#7Classic New York Times. Explicit tax law = "loophole" if the NYT doesn't like the people who follow that particular explicit tax law.
Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#8Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#9It's not a loophole, it's a specific tax break for people cashing out of "small" businesses. ("small" means at the time you joined -- it can have grown huge since.) QSBS can save you a lot, but it can be a lot of work to file too. I ran up about $20k in accountant bills doing it on a complex deal. If you're selling founder or early-employee stock, ask your accountant if QSBS is right for you.
Loophole doesn’t have a strict definition. Almost any deduction could be a loophole. Usually it is referring to anything that helps people with high incomes avoid paying taxes.
Re: Qualified Small-Business Stock rule helps Silicon Valley workers save millions
#10It's not a loophole, it's a specific tax break for people cashing out of "small" businesses. ("small" means at the time you joined -- it can have grown huge since.) QSBS can save you a lot, but it can be a lot of work to file too. I ran up about $20k in accountant bills doing it on a complex deal. If you're selling founder or early-employee stock, ask your accountant if QSBS is right for you.
It does seem like taking the piss for a multimillion dollar startup to qualify as a "small business". Just because you're staying within the letter of the law doesn't mean it's not a loophole -- arguably that's exactly what a loophole is.
According to the article, professional accountants consider this scheme dubious.