House Passes 100% Exclusion On Sales of Certain Qualified Small Business Stock | Startup Law Blog
Today the House passed a bill which would completely exempt from capital gains taxes (subject to per taxpayer limitations) the gain on the sale of qualified small business stock held for more than 5 years, if such stock was purchased after March 15, 2010, and before January 1, 2012. It is unclear if the Senate will pass this bill. The bill also makes clear that no part of the exclusion is an alternative minimum tax adjustment. The provision as passed by the House is quoted below. For press coverage, see The Hills' coverage. If the Senate passes this provision, a lot more intensity will be brought to bear on representations and warranties in stock purchase agreements that stock being purchased qualifies as "qualified small business stock." In addition, special scrutiny will be brought to bear on redemptions and other historical transactions which could disqualify stock from qualifying. As I've indicated before, I think that the short window in which this 100% exclusion is actually