August 12, 2025 • 27 mins
In this episode of the Teaching Tax Flow podcast, hosts Chris Picciurro, CPA, and John Tripolsky welcome Brady Weller, co-founder of QSBS Rollover, to explore one of the most powerful — and most overlooked — tax planning tools for entrepreneurs: the Qualified Small Business Stock (QSBS) exemption.
If you’re a startup founder, business owner, or investor looking to optimize your exit strategy, this conversation could save you millions in taxes. Brady breaks down IRC Section 1202, explaining how the QSBS exemption allows eligible C Corporation shareholders to exclude up to $10 million (or 10x their basis) in capital gains from federal income tax.
The discussion also covers the QSBS rollover under IRC Section 1045, a strategy Brady likens to a “1031 exchange for company stock” — enabling sellers to reinvest gains into another qualified small business and defer taxes. The episode is packed with real-world applications, planning tips, and insight into recent legislative enhancements through the Inflation Reduction Act, which increased the QSBS exclusion cap and reaffirmed bipartisan support for innovation incentives.
Whether you’re preparing for a major exit or just learning about QSBS for the first time, this episode is a masterclass in how to use specialized tax planning to unlock significant wealth.
What You’ll Learn:
• How QSBS works and who qualifies
• The tax savings potential: $10M+ federal gain exclusion
• How the QSBS rollover under Section 1045 defers taxes
• Legislative updates that make QSBS even more attractive
• State-by-state considerations for QSBS eligibility
• Why early and specialized planning is critical for maximum benefit
Key Insights:
Brady Weller reveals how QSBS is often an untapped goldmine for founders — and why lack of awareness can mean leaving millions on the table. From structuring your business properly to timing exits and using rollovers, the right QSBS strategy can dramatically reshape your after-tax results.
Notable Quotes:
• “QSBS is one of the most powerful tax exemptions available, allowing federal income tax exemption on up to $10 million of gain.” – Brady Weller
• “We dreamed of creating an always available, downside-protected option for founders to execute these rollovers successfully.” – Brady Weller
• “OBBBA made QSBS even more powerful, expanding exclusion cap to $15 million, showing bipartisan support for this incentive.” – Brady Weller
• “QSBS and its rollovers provide a 1031-type tax deferral for company stock, fundamentally transforming tax planning strategies for many.” – Brady Weller
• “Our firm realizes around $3 billion in exit volume, emphasizing significant missed opportunities in the current system.” – Brady Weller
Resources:
• Connect with Brady Weller on LinkedIn
Episode Sponsor:
Strategic Associates, LLC
Roger Roundy
www.linkedin.com/in/roger-roundy-86887b23
- (00:02) - Exploring Tax-Free Gains Through IRS Section 1202 QSBS
- (03:09) - Exploring Capital Gains Tax Mitigation with Brady Weller
- (05:19) - Exploring QSBS: A Powerful Yet Underutilized Tax Exemption
- (07:42) - Understanding Qualified Small Business Stock and Tax Exemptions
- (12:04) - Maximizing QSBS Benefits for Startup Founders Exiting Early
- (17:54) - Strategies for Starting or Acquiring a Business with QSPS Credit
- (19:36) - Understanding QSBS Rollovers and Tax Deferrals
- (21:15) - Navigating Related Party Rules in Business Exits
- (22:35) - The Future of QSBs and Tax Exclusions
- (24:37) - Exploring QSBS Rollover Benefits and Personalized Investment Advice
- (27:18) - Investment Offerings and Risk Factors in Financial Memorandums
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
John Tripolsky (00:02):
Hey, everybody, and welcome back to the podcast
episode 148. Today, we'relooking at something that some
consider to be too good to betrue. That's right. We're
looking at section 12 o two fromthe IRS, QSBS. It's got a nice
little ring to it. You're gonnalearn more about it here in a
moment with a great guest. Butas always, let's take a brief
(00:25):
moment and thank our episodesponsor.
Ad Read (00:29):
This podcast is brought to you by Strategic Associates.
Are you a high income earner,real estate investor, or
successful entrepreneur who isfrustrated by having to pay
$75,000 or more of annual taxliability? If so, Strategic
Associates can help. Your firststep to saving thousands, if not
hundreds of thousands, is tocontact Roger Roundy at
(00:50):
roger@strategicag.net or bycalling (801) 641-2956, and be
sure to tell them TTF sent you.
John Tripolsky (01:00):
Hey, everybody, and welcome back to the Teaching
Tax Flow podcast. Obviously, youknow why we're here because,
hopefully, you can read thetitle and the show notes if you
dug in a little bit deeper. Buton this topic, we got another
good one, one that you may notexpect from us with some of the
content that we've been doingrecently, but we promise it all
ties together. And, ChrisPacquero, welcome back to your
(01:22):
own show, sir. You know, we wedo open the door for you every
once in a while, you know, to tolet you come back. So welcome.
Chris Picciurro, CPA (01:29):
Well, I appreciate it. I'm really
excited about our special guestthis week. Couple of things.
Remember, within teaching taxflow, we have three laws. One of
the three laws is that that cashflow and tax flow are different,
meaning not not all income istaxed the same.
And one of the things we wannafocus on is not just tax
(01:52):
deferral, not just tax, youknow, putting money away into
retirement, which could beimportant, but strategies for
people, especially businessowners that we're gonna talk
about today to, enjoy tax freeincome, tax free capital gains.
There aren't that many spots inthe tax code that allow for
this. One of the other laws isthat that tax agencies are our
(02:13):
involuntary business partner,and tax laws are written to
encourage and discourage certainsocial, economic, environmental
behavior. And one of the taxlaws that we're gonna dive in
into today, can really, reallyhelp those small business
owners, small to medium sizedbusiness owners. Actually, lot
of different business owners.
And we get a lot of questions inthe teaching tax flow community,
(02:35):
not just in the on the privateFacebook group, but in our
private CPA practice. Theyreally usually, the question is
is that that the entrepreneurdoesn't know what the heck
they're asking about. Right? Butthey're what they're asking is,
hey. I heard there's a way to tonot pay tax on millions of
dollars of gain when I sell mycompany, and they don't they
might hear about QSBS or theymight hear about section, 12 o
(02:58):
two or, but they they don'treally know what they're talking
about.
They just heard that they thatthat they might be able to take
advantage of this, and andthat's why we bring in the best
guests. So so exciting. Soexcited.
John Tripolsky (03:12):
You're so excited. I can't even get the
words out, man.
Chris Picciurro, CPA (03:14):
I'm so good. Right. I you know, John,
you know, and and Brady, he'sgot Brady Weller's with us from
QSPS rollover. I'm so excited tohave him. And, John, you know
that I've been waiting for thistopic for for a long time.
We've been really looking forthat right person, and Brady is
the man. So welcome to theteaching tax flow show, Brady.
Brady Weller (03:34):
Thanks, John. Thanks, Chris. Appreciate it.
Yeah. I love your content. Gladto be on.
John Tripolsky (03:37):
Yeah. Yep. So, Brady, basically, Chris is so
excited about this. Right? Like,this is kind of his, I guess,
call it, like, the white whalecontent, very similar to the one
that I put on the list a couplemonths back that he absolutely
did not wanna do.
And I I used some, very bold Ithink I bolded him, italicized
him, and put him in red. Nocomplaining when, when I threw
(03:58):
some topics in there. So this ishis version of, of mine on the
Venmo tax. So let's, don't lethim down, sir. Don't let him
down because I have to deal withhim crying afterwards. So
Brady Weller (04:10):
Yeah. I mean, Chris, you mentioned, like, you
know, thing tax mitigation,especially capital gains tax
mitigation that most peoplemaybe know about and from
listening to your content, someothers content like opportunity
zones, ten thirty one exchanges,QSPS fits right right in there,
but it's even more powerful. Soexcited to jump in.
Chris Picciurro, CPA (04:29):
Yeah. Well, can you give us a little
bit of history? I a littlebirdie told me that you're a
Baltimore Oriole fan, and we arerecording this on your birthday.
Brady Weller (04:36):
So Yeah.
Chris Picciurro, CPA (04:37):
We're gonna we're gonna yeah. So for
you you for those of youwatching on YouTube, you could
see, is that Camden Yard?
Brady Weller (04:43):
Yep. This is opening day 1992 at Camden
Yards. Well, it's a painting,but, I guess someone was up in
the up in the box, sketching itout. So
Chris Picciurro, CPA (04:51):
Yeah. It's a gorgeous, gorgeous, state of
John and I actually were there afew years ago for a conference.
We got to go in one of theboxes. It's just a that it's
just not even it's a it's morethan a stadium, but it's just a
an awesome area. But
Ad Read (05:05):
Basically a landmark.
John Tripolsky (05:06):
Is. Come up with anything else.
Chris Picciurro, CPA (05:08):
Yeah. It's been it's really nice. Tell us
about a little bit aboutyourself, how you got into this
QSBS space, and and what excitesyou about it.
Brady Weller (05:19):
Yeah. Of course. Again, thanks for having me. We
were running a a differentbusiness, actually, in the
alternative asset space. Soseveral years ago, was an early
employee at a firm that wasdoing wine and spirits
investing, and we still areworking on parts of that entity,
but today we do QSPS exclusivelyand that was a really big pivot
(05:44):
for us but we came acrossqualified small business stock
while we were exploring thealternative asset space back
then.
We had a family office who wasmaking a lot of early stage
investments and we were talkingwith them about QSPS.
Ultimately, we started divingdeeper, we found QSPS rollovers,
which I'll dig into today. Andwe realized that it was again
(06:06):
the most powerful tax exemptionin The United States, but there
was basically no infrastructurearound advisors helping people
to maximize it. When you thinkof ten thirty one exchanges in
real estate or you think ofopportunity zones or qualified
opportunity zone funds, there'smassive infrastructure both
(06:27):
among financial advisors,attorneys and whatnot to support
that industry, and there isabsolutely none of that in the
QSPS space. You'll find about 75attorneys across the country who
have any kind of advancedknowledge about QSPS and
probably another 75 CPAs.
(06:47):
And so I've spent the last twoand a half years doing
functionally nothing else exceptdigging into QSPS, and we've
developed a set of services toallow business owners exiting to
capitalize on it if theyqualify. So
Chris Picciurro, CPA (07:02):
Awesome. And can you give us a 30,000
foot view of what QSPS is, andand what type of business owner
should be should be thinkingabout this?
Brady Weller (07:12):
Sure. Yeah. There are some you know, it's not one
size fits all, but there someindications that a business or a
type of stock might qualify. Andso we're only looking at C
Corps, so this is stock issuedfrom C Corps that has been held
for at least five yearstraditionally. So qualified
small business stock is incometax exemption that can be
(07:35):
claimed up to $10,000,000 mostlyfor founders or 10x the basis in
the stock.
I always use $10,000,000 becausefounders have no basis in their
stock, they got it on day one.So for the purpose of this
$10,000,000 exclusion, if youhold c corp stock for five years
and you are not operating in aexcluded business category.
(07:59):
Those are businesses likefinancial services, medical
services like doctor's offices,real estate, other investment
companies. So tech,manufacturing, e commerce, any
of those types of businessesqualify, and more than 90%, 95
or more of venture backedstartups are gonna qualify for
(08:21):
this exemption.
Chris Picciurro, CPA (08:23):
Wow. And is that exemption per entity,
per shareholder, and and arethere and do you
Brady Weller (08:29):
have to be the original shareholder to qualify?
You do have to be the originalshareholder. That is your stock
has to be issued directly fromthe corporation. Okay. So
founders obviously got theirstock on day one.
Early employees who exercisetheir options and take hold of
stock would start their QSPSclock ticking. Nice. Now outside
(08:52):
investors who purchase aminority interest seven years
into the business through asecondary channel, they're not
getting that stock originalissuance, so they would not
qualify. But the benefit appliesper entity, so per issuer of
stock, as well as pershareholder, which means that if
John makes five different angelinvestments in five different
(09:13):
companies, he might have fivedifferent $10,000,000 QSPS
exclusions per investment thathe's made.
Chris Picciurro, CPA (09:21):
Wow. So so if he an individual could have
multiple QSPS exemptions if butthen if the $10 limit Yeah.
Parenthly.
Brady Weller (09:31):
Yeah. If he knocks it out of the park on all five
of those angel investments andmakes $8,000,000 on his $50,000
check-in each of them, That8,000,000 is federal income tax
exempt. And, John, I don't knowif you pay taxes in Tennessee or
where, but, probably state, taxexempt as well as long as you're
not in California orPennsylvania. Yeah.
John Tripolsky (09:50):
And if that ever happens, I'm gonna completely
hide my hide my crystal ball inthe closet so nobody else can
Chris Picciurro, CPA (09:56):
find it.
Brady Weller (09:57):
Not gonna be on the tax flow podcast if he hits
a, you know, $40,000,000 exit.
John Tripolsky (10:01):
No. We're we're going to a cardboard cutout of
me
Chris Picciurro, CPA (10:04):
There you go.
John Tripolsky (10:05):
At that point. So
Chris Picciurro, CPA (10:05):
We would we would ask him to be a sponsor
at that point. Nice. We namedthe studio after him.
John Tripolsky (10:10):
There you go.
Chris Picciurro, CPA (10:11):
That's up for grabs right now.
Brady Weller (10:13):
So QSPS is that's section 12 o two. I know you
mentioned the numbers early on.And some people, you know, when
you're Googling around, youmight see section twelve oh two,
which is the code text or youmight see qualified small
business stock, QSPS. Now, thereis another part of the code and
that's what our firm worksexplicitly on and that's the
number of the code is ten fortyfive and it's called QSPS
(10:36):
rollovers is what we call it.Some people call it a ten forty
five rollover.
And what that means is you canactually take the gains from the
sale of qualified small businessstock, the type of stock that I
described and you can reinvestthose gains into new qualified
small business stock. So if yourlisteners are familiar with the
ten thirty one exchange whereyou take gains from a sale of
(10:58):
property and roll it into likekind property, This is the ten
thirty one exchange for companystock. Now the reason why
someone would wanna do this isbecause when you do a QSPS
rollover, it allows you tocontinue your holding period,
meaning if you sell stock inyour company at year three and
(11:18):
you say, man I didn't reach thefive year period for the QSPS
exemption, now I owe taxes, youactually have sixty days to
reinvest that money into newstock and it will continue your
holding period. Maybe you holdthat new stock for four years,
so you're at a combined sevenand then you exit, now you can
take your exclusion becausethose holding periods tack on.
(11:39):
So it's extremely powerful butit's not powerful if there are
no good rollover options.
So traditionally it's like, heyI exited my startup at year
three, I have this big tax billbut I'm not gonna just go invest
in John's startup, like he'sgonna burn my money
statistically or they're gonnafail statistically, so that's
(12:00):
not a good tax planning tool,right? So when we step back and
we looked at the code here, wesaid, hey, why is there so much
infrastructure and help forpeople to execute other kinds of
tax exemptions and there's nonefor QSPS and QSPS rollovers? And
so we dreamed and we said, hey,what if there existed an always
(12:22):
available downside protected andhighly defensible option for
people to execute theserollovers? We think internally
that founders leave around$15,000,000,000 on the table
every year because they don'tmaximize QSPS. We will see about
$3,000,000,000 worth of exitvolume next year from founders
(12:43):
with this exact problem is ourestimate.
And from September to May, wesaw more than a billion dollars
just in the first, call it, sixmonths of us running our newest
program. Wow. Wow. Massiveproblem.
Chris Picciurro, CPA (12:56):
No. It is because I we I'm in being a CPA
firm owner for over twentyyears, most let's put this
aside. Most people that exittheir business or get an offer,
sometimes an offer that theycan't refuse to exit their
business, typically, c corpsaren't used as much, or they
didn't realize five years inadvance that they were gonna get
(13:19):
it. So the practical problemthat solves is I've got a c I've
got someone that's positioningas as a and and maybe elects for
their LLC to be taxed as a ccorp Mhmm. Two, three years ago,
you're solving the problem thatthey didn't see five who the x
sees five years in advance whenyou're a business person.
Right? So you're kinda helpingsolve that that problem for them
(13:40):
where
Brady Weller (13:40):
they could still qualify for the QSPS. Yeah. Now,
frankly, we work on the coastsjust because, like, venture in
New York or venture inCalifornia, and that's just
right down the fairway for folkswho are gonna qualify. But we're
seeing so much more in Chicago,in Denver, in Austin, in Miami,
in DC, Virginia, know, startupecosystems are blooming in those
(14:03):
places. Our bread and butter arethe coasts because that's how
sort of the capital is playedout, but if you have a pass
through entity, maybe you havean S Corp, you know a lot of
these family businesses lookingto exit in the next call it
three to five years or lookingto make a generational
(14:23):
transition in the next three tofive years, then you do sort of
have an idea of hey, can we movethings around, convert to a C
Corp, reissue some new stock,reformat things here as we plan
for an exit.
Now it doesn't work for everyindustry because you do need to
do a stock sale in order toexecute QSBS. So I know for many
(14:45):
of our listeners who haveservice businesses, any exit
just isn't going to be a stocksale, it's gonna be an asset
sale of some kind. But thereare, you know, ways that you can
fashion deals to make it work,and it it's certainly worth
exploring given the benefits.
Chris Picciurro, CPA (15:02):
And and a lot of the people that do more
more asset sales and stock salesmight be in an industry that
aren't gonna is not gonnaqualify for QSPS anyway. So
John Tripolsky (15:10):
It's possible.
Brady Weller (15:11):
Yeah. It's possible.
Chris Picciurro, CPA (15:11):
You're you know, that so can can talk can
you talk kinda through themechanics? So, obviously, you
know, someone that has aqualifying business, five year
hold period can exclude up tothe $10,000,000 of capital gain.
Remember, it has to be a and wehave some content on this, a
stock sale, not an asset sale.Now a lot of times, what we're
seeing in many of the industriesis stock sales are becoming a
(15:33):
little more prevalent becauseof, like, contracts. You you
might have a contract with anentity that's not transferable
to another one.
So that that could be the thatcould be the case, or the c corp
might have r and d creditscarrying forward or NOLs. You
know, there could be some taxattributes in that c corp that
the the acquiring company wouldlike. But how would can you tell
(15:55):
us about some maybe, you know, alittle more on the rollover
mechanics just from a, like, a30,000 foot PO game. Like, hey.
I've I've got a tell us a clientsuccess story.
Obviously, I'm gonna say what itmeans, but, yeah, that's that's
probably the best teller of ofsomeone that maybe has been
working for two or three yearsand
Brady Weller (16:14):
as a c corp or in in Well, we working out. We're
we're seeing these all the timeright now because of a the AI
boom. I've seen full exits inless than a year. I've seen, you
know, $100,000,000 plus seed inseries a rounds, which, you
know, are extremely large.Opportunities for founders to be
taking large amounts ofliquidity via secondary at
(16:36):
series a.
So mainly talking about venturebacked businesses here, and I
can tell you, give you an ideaof a success story from maybe a
place like New York where forlarger exits, the combined
federal and state tax rate canbe 35, 37%. And so on
$10,000,000, you're looking at a$3,500,000 tax bill. So say a
(16:59):
founder in New York exits for$5,000,000 at year three, they
have an AI business and theysold it to a larger company. At
$5,000,000 they're on the hookfor a 7 figure tax bill, taking
that money, literally the cashthat got wired to them, they
would come to typically ifthey're working with us, they
(17:20):
would come to us and say, hey, Iwanna do a QSPS rollover, we'd
say great, you have a couple ofdifferent options, You can make
an angel investment or deploycapital to an outside business.
We've described maybe not thebest for most people situations,
but there are two other thingsyou can do.
One, you can start your own newcompany and issue yourself stock
(17:42):
in a new business just like youdid when you founded your first
company and you can immediatelystart running that in a
qualified sector and that can beyour rollover. Or you can start
a new company and you can domarket research and development
work to go out and identify abusiness that you could acquire
or start. The IRS is actuallygonna give you a safe harbor
(18:05):
period, call it like a rollingtwo to three year ish period
where they're gonna say, hey,all of that research and
development, that startup work,that exploration for a business
to acquire, we're gonna callthat working capital for these
purposes and so you get QSBScredit for that. So that's a
really interesting option. Now,something you can't do is just
create a new c corp, throw moneyin there, sit in Cabo and say,
(18:28):
yeah, I'm emailing some folksabout buying their business.
Right. We believe that the baris extremely high for
substantiating these and thelarger the numbers get, a couple
$100,000, fine, but you get intoseveral million dollars, a
little bit harder tosubstantiate that yeah, I'm
actually going out and doing Rand D work. And so that's what
(18:49):
our firm does, We do end to endrollover compliance,
substantiate substantiation andmarket research in order to
justify the use of proceeds inyour new rollover entity.
Chris Picciurro, CPA (19:01):
It's a couple. Yeah. Oh, no. That makes
sense. So just like we talkedabout, it's you know, ideas are
cheap.
Implementation's valuable. Yep.So having the right
implementation partner like likeyour firm is important. You
can't I do have a question. Sowhen when someone does let's say
they're doing the QSPS rollover.
They sell their company stock.They get wired, you know, for,
(19:24):
let's say, $8,000,000. Does thathave to go through a call an
intermediary similar to a tenthirty one exchange, or can they
does it can it hit their bankaccount and then they they try
to do a rollover?
Brady Weller (19:36):
Yeah. It's actually they can just do it
directly, and it's fungible aswell, which means that you could
get that money, you could throwthat $8,000,000 in a treasury
account, then you could pull aline of credit off of it and use
the money from the line ofcredit. Like yeah, it's
completely fungible, $8,000,000and the rollover is a claim that
you would make on your scheduleD when you file your taxes. And
(19:59):
so someone has their exit that$8,000,000, they have that
$8,000,000 gain recorded,They're gonna work with their
CPA to write, you know, belowit. Basically, we're claiming
$10.45.
We're claiming a QSPS rolloverand a gain deferral. What that
means is if you do that withinsixty days, whether you roll
over $8,000,000 or $5,000,000whatever portion, you can claim
(20:23):
that as a deferral for theperiod that you're in that new
business. And then down theline, maybe you hold that stock
for another four years and thenyou get liquid again, pull it
out. At that point, you'll beable to claim your tax exemption
under section 12 o two on QSPS.So a rollover in itself is a
(20:43):
continuation of QSPS and taxdeferral, and then QSPS is
ultimately what gets you to theexemption.
Chris Picciurro, CPA (20:49):
Oh. And so if you're a tax professional and
you have clients out there thatyou think Brady and his his team
could work with, just reach outto us. If you're a business
owner, you're thinking aboutexiting. Are there are there I I
have two more questions, and Iknow we'll then we'll wrap it
up. Are there related any typeof, like, related party rules or
or, you know, let's say I'm aI'm selling my stock to, one of
(21:13):
my children.
Yeah.
Brady Weller (21:15):
Yes. That can come up and and really it's gonna
come up when we're talkingabout, yeah, related party sales
and conversions. So we wanna becareful with those transactions,
we wanna be careful with thepurchase, the sale, the
reissuance of stock, all thosesort of events that happen maybe
on the balance sheet of thecompany, whether they're
(21:35):
buybacks or redemptions, any ofthose types of transactions. If
you have QSPS in mind, you'regoing to want to work with
someone to pay attention to theimplications there. We have
maybe the broadest network inthe country of those 75 folks in
each camp, CPAs, attorneys,people who can help you navigate
that.
And we do free consultations interms of checking out your
(21:58):
situation and helping to pointyou in the right direction. So
if you've heard me talking aboutventure and you say, well, that
just doesn't apply, still worthreaching out and seeing what the
options could be.
Chris Picciurro, CPA (22:10):
And my final question is we wrap it up
because a lot of people, wantwould like to know. Oh, you
know, has has, OB three changedor or or allowed this to
continue? Is this something thatwe have to do in before 2026?
What's the future of of QSBSlook like kind of, you know,
(22:32):
that from a broader view?
Brady Weller (22:35):
Yeah. Section 12 o two of QSBS started in '93. It
was expanded to where it iswell, was earlier this year by
the Obama administration in2010, 2011, and then it's been
expanded again. And so back whenit was expanded maximally the
first time, it was a Democraticadministration, Democratic
(22:56):
Senate. Now we have it in aRepublican White House and
Republican Senate, expanded onceagain, seen bipartisan support
for twenty five years or more,and rollover is the same.
Rollovers were implemented in1997. So we're extremely
confident in the long termhealth of QSPS. It's clear that
both sides of the aisle want toincentivize innovation and
(23:19):
entrepreneurship and deploymentof capital. So yeah, OBBBA made
QSPS even more powerful, itexpanded the exclusion cap from
$10,000,000 to $15,000,000 perperson per issuer, and it
expanded the gross asset test.So when you talk about small
business, these businessesissuing eligible stock have to
(23:41):
be, used to have to be under$50,000,000 in gross assets,
that's been expanded to$75,000,000 which means that for
venture backed businessesprobably up to series B and
maybe even beyond depending onthe size of fundraisers, they're
gonna keep issuing that eligiblestock.
And the last thing is there'sbeen a tiered exemption
(24:03):
implemented, which means that ifyou have stock issued after July
4, when this went into effect,even if you hold for three
years, you can take a 50%exclusion, four years a 75%
exclusion, and five years that100% tax exclusion up to
$15,000,000 goes into effect.So, yeah, that's all stock
(24:24):
issued after July 4. For mostpeople we're talking to, that's
just not in play yet. But overthe next year, one to three
years, we're gonna start seeinga ton of folks in that camp.
Chris Picciurro, CPA (24:36):
That is awesome. Well, thank you so
much. And, John, I know you'regonna put a lot of Brady's
information in our in our notes.What's the best way to reach out
to you and the team at QSPSrollover?
Brady Weller (24:49):
We're easy to find, qsbsrollover.com. It's
easy to schedule a call with us.Both my co founder and I and our
our team are available to chatwith anyone at any time. Happy
to work through your situation.You can follow us on LinkedIn.
We're pretty active there.Follow me on LinkedIn. I post
funny stories about peoplemissing out or being able to
(25:10):
take advantage of QSPS. So lookforward to seeing people. Nine,
muted.
Chris Picciurro, CPA (25:24):
You're muted.
John Tripolsky (25:25):
Oh, there we go. Holy cow. Talk about missing out
on things. Here I am. I mutedmyself, and I'm talking about
missing I was gonna say thereprobably the the examples that
you give of people missing outis absolutely hilarious at some
point, but to other people, notto them.
So we'll definitely drop yourcontact in there. I know this we
could we could take this downprobably many avenues, many
(25:46):
examples of of diving intospecific stuff. So I'd probably
say and tell me if I'm correctis if anybody has these
questions a little bit more indetail, you know, the we just
skimmed the iceberg, basically,on this one.
Brady Weller (25:58):
Absolutely.
John Tripolsky (25:58):
Any of those questions reach out to you
directly, and you guys coulddive into those on a really at a
case by case basis. Correct?
Brady Weller (26:03):
100%. Yep.
John Tripolsky (26:05):
Yep. Awesome. Awesome. Well, thanks for
joining us. I appreciate it.
And, Chris, hopefully hopefully,you know, this guest we have
here stood up to your, yourexpectations on the topic. So
now we
Chris Picciurro, CPA (26:15):
Oh, I had no doubt he would. So We don't
have
John Tripolsky (26:17):
to get you, you know, a little cheese plate and
play the fiddle for you. Youshould be okay. So awesome.
Chris, thanks for theintroduction to him. Ray, thanks
for joining us, man.
We'll again, we'll drop yourcontact in there. And, if
anybody has those questions,drop him a line, him and his
business partner. Again, don'tbe lazy. Right there in the show
notes and down here and off tothe side, depending on what
(26:39):
platform you're looking at.Check it out, and we will see
everybody back here again nextweek.
Different date, same day of theweek, completely different topic
here on the Teaching Tax Reformpodcast. Have a great week,
everybody.
Disclaimer (26:56):
The content provided is for educational purposes
only. We encourage you to seekpersonalized investment advice
from your financialprofessional. For all tax and
legal advice, please consultyour CPA or attorney. Investment
advisory services are throughCabin Advisors, a registered
investment advisor.
Securities are offered throughCabin Securities, a registered
broker dealer. The content ofthis podcast does not constitute
(27:16):
an offer of securities.Offerings can only be made
through an offering memorandum,and you should carefully examine
the risk factors and otherinformation contained in the
memorandum.
Hey, everybody, and welcome back to the podcast
episode 148. Today, we'relooking at something that some
consider to be too good to betrue. That's right. We're
looking at section 12 o two fromthe IRS, QSBS. It's got a nice
little ring to it. You're gonnalearn more about it here in a
moment with a great guest. Butas always, let's take a brief
(00:25):
moment and thank our episodesponsor.
Ad Read (00:29):
This podcast is brought to you by Strategic Associates.
Are you a high income earner,real estate investor, or
successful entrepreneur who isfrustrated by having to pay
$75,000 or more of annual taxliability? If so, Strategic
Associates can help. Your firststep to saving thousands, if not
hundreds of thousands, is tocontact Roger Roundy at
(00:50):
roger@strategicag.net or bycalling (801) 641-2956, and be
sure to tell them TTF sent you.
John Tripolsky (01:00):
Hey, everybody, and welcome back to the Teaching
Tax Flow podcast. Obviously, youknow why we're here because,
hopefully, you can read thetitle and the show notes if you
dug in a little bit deeper. Buton this topic, we got another
good one, one that you may notexpect from us with some of the
content that we've been doingrecently, but we promise it all
ties together. And, ChrisPacquero, welcome back to your
(01:22):
own show, sir. You know, we wedo open the door for you every
once in a while, you know, to tolet you come back. So welcome.
Chris Picciurro, CPA (01:29):
Well, I appreciate it. I'm really
excited about our special guestthis week. Couple of things.
Remember, within teaching taxflow, we have three laws. One of
the three laws is that that cashflow and tax flow are different,
meaning not not all income istaxed the same.
And one of the things we wannafocus on is not just tax
(01:52):
deferral, not just tax, youknow, putting money away into
retirement, which could beimportant, but strategies for
people, especially businessowners that we're gonna talk
about today to, enjoy tax freeincome, tax free capital gains.
There aren't that many spots inthe tax code that allow for
this. One of the other laws isthat that tax agencies are our
(02:13):
involuntary business partner,and tax laws are written to
encourage and discourage certainsocial, economic, environmental
behavior. And one of the taxlaws that we're gonna dive in
into today, can really, reallyhelp those small business
owners, small to medium sizedbusiness owners. Actually, lot
of different business owners.
And we get a lot of questions inthe teaching tax flow community,
(02:35):
not just in the on the privateFacebook group, but in our
private CPA practice. Theyreally usually, the question is
is that that the entrepreneurdoesn't know what the heck
they're asking about. Right? Butthey're what they're asking is,
hey. I heard there's a way to tonot pay tax on millions of
dollars of gain when I sell mycompany, and they don't they
might hear about QSBS or theymight hear about section, 12 o
(02:58):
two or, but they they don'treally know what they're talking
about.
They just heard that they thatthat they might be able to take
advantage of this, and andthat's why we bring in the best
guests. So so exciting. Soexcited.
John Tripolsky (03:12):
You're so excited. I can't even get the
words out, man.
Chris Picciurro, CPA (03:14):
I'm so good. Right. I you know, John,
you know, and and Brady, he'sgot Brady Weller's with us from
QSPS rollover. I'm so excited tohave him. And, John, you know
that I've been waiting for thistopic for for a long time.
We've been really looking forthat right person, and Brady is
the man. So welcome to theteaching tax flow show, Brady.
Brady Weller (03:34):
Thanks, John. Thanks, Chris. Appreciate it.
Yeah. I love your content. Gladto be on.
John Tripolsky (03:37):
Yeah. Yep. So, Brady, basically, Chris is so
excited about this. Right? Like,this is kind of his, I guess,
call it, like, the white whalecontent, very similar to the one
that I put on the list a couplemonths back that he absolutely
did not wanna do.
And I I used some, very bold Ithink I bolded him, italicized
him, and put him in red. Nocomplaining when, when I threw
(03:58):
some topics in there. So this ishis version of, of mine on the
Venmo tax. So let's, don't lethim down, sir. Don't let him
down because I have to deal withhim crying afterwards. So
Brady Weller (04:10):
Yeah. I mean, Chris, you mentioned, like, you
know, thing tax mitigation,especially capital gains tax
mitigation that most peoplemaybe know about and from
listening to your content, someothers content like opportunity
zones, ten thirty one exchanges,QSPS fits right right in there,
but it's even more powerful. Soexcited to jump in.
Chris Picciurro, CPA (04:29):
Yeah. Well, can you give us a little
bit of history? I a littlebirdie told me that you're a
Baltimore Oriole fan, and we arerecording this on your birthday.
Brady Weller (04:36):
So Yeah.
Chris Picciurro, CPA (04:37):
We're gonna we're gonna yeah. So for
you you for those of youwatching on YouTube, you could
see, is that Camden Yard?
Brady Weller (04:43):
Yep. This is opening day 1992 at Camden
Yards. Well, it's a painting,but, I guess someone was up in
the up in the box, sketching itout. So
Chris Picciurro, CPA (04:51):
Yeah. It's a gorgeous, gorgeous, state of
John and I actually were there afew years ago for a conference.
We got to go in one of theboxes. It's just a that it's
just not even it's a it's morethan a stadium, but it's just a
an awesome area. But
Ad Read (05:05):
Basically a landmark.
John Tripolsky (05:06):
Is. Come up with anything else.
Chris Picciurro, CPA (05:08):
Yeah. It's been it's really nice. Tell us
about a little bit aboutyourself, how you got into this
QSBS space, and and what excitesyou about it.
Brady Weller (05:19):
Yeah. Of course. Again, thanks for having me. We
were running a a differentbusiness, actually, in the
alternative asset space. Soseveral years ago, was an early
employee at a firm that wasdoing wine and spirits
investing, and we still areworking on parts of that entity,
but today we do QSPS exclusivelyand that was a really big pivot
(05:44):
for us but we came acrossqualified small business stock
while we were exploring thealternative asset space back
then.
We had a family office who wasmaking a lot of early stage
investments and we were talkingwith them about QSPS.
Ultimately, we started divingdeeper, we found QSPS rollovers,
which I'll dig into today. Andwe realized that it was again
(06:06):
the most powerful tax exemptionin The United States, but there
was basically no infrastructurearound advisors helping people
to maximize it. When you thinkof ten thirty one exchanges in
real estate or you think ofopportunity zones or qualified
opportunity zone funds, there'smassive infrastructure both
(06:27):
among financial advisors,attorneys and whatnot to support
that industry, and there isabsolutely none of that in the
QSPS space. You'll find about 75attorneys across the country who
have any kind of advancedknowledge about QSPS and
probably another 75 CPAs.
(06:47):
And so I've spent the last twoand a half years doing
functionally nothing else exceptdigging into QSPS, and we've
developed a set of services toallow business owners exiting to
capitalize on it if theyqualify. So
Chris Picciurro, CPA (07:02):
Awesome. And can you give us a 30,000
foot view of what QSPS is, andand what type of business owner
should be should be thinkingabout this?
Brady Weller (07:12):
Sure. Yeah. There are some you know, it's not one
size fits all, but there someindications that a business or a
type of stock might qualify. Andso we're only looking at C
Corps, so this is stock issuedfrom C Corps that has been held
for at least five yearstraditionally. So qualified
small business stock is incometax exemption that can be
(07:35):
claimed up to $10,000,000 mostlyfor founders or 10x the basis in
the stock.
I always use $10,000,000 becausefounders have no basis in their
stock, they got it on day one.So for the purpose of this
$10,000,000 exclusion, if youhold c corp stock for five years
and you are not operating in aexcluded business category.
(07:59):
Those are businesses likefinancial services, medical
services like doctor's offices,real estate, other investment
companies. So tech,manufacturing, e commerce, any
of those types of businessesqualify, and more than 90%, 95
or more of venture backedstartups are gonna qualify for
(08:21):
this exemption.
Chris Picciurro, CPA (08:23):
Wow. And is that exemption per entity,
per shareholder, and and arethere and do you
Brady Weller (08:29):
have to be the original shareholder to qualify?
You do have to be the originalshareholder. That is your stock
has to be issued directly fromthe corporation. Okay. So
founders obviously got theirstock on day one.
Early employees who exercisetheir options and take hold of
stock would start their QSPSclock ticking. Nice. Now outside
(08:52):
investors who purchase aminority interest seven years
into the business through asecondary channel, they're not
getting that stock originalissuance, so they would not
qualify. But the benefit appliesper entity, so per issuer of
stock, as well as pershareholder, which means that if
John makes five different angelinvestments in five different
(09:13):
companies, he might have fivedifferent $10,000,000 QSPS
exclusions per investment thathe's made.
Chris Picciurro, CPA (09:21):
Wow. So so if he an individual could have
multiple QSPS exemptions if butthen if the $10 limit Yeah.
Parenthly.
Brady Weller (09:31):
Yeah. If he knocks it out of the park on all five
of those angel investments andmakes $8,000,000 on his $50,000
check-in each of them, That8,000,000 is federal income tax
exempt. And, John, I don't knowif you pay taxes in Tennessee or
where, but, probably state, taxexempt as well as long as you're
not in California orPennsylvania. Yeah.
John Tripolsky (09:50):
And if that ever happens, I'm gonna completely
hide my hide my crystal ball inthe closet so nobody else can
Chris Picciurro, CPA (09:56):
find it.
Brady Weller (09:57):
Not gonna be on the tax flow podcast if he hits
a, you know, $40,000,000 exit.
John Tripolsky (10:01):
No. We're we're going to a cardboard cutout of
me
Chris Picciurro, CPA (10:04):
There you go.
John Tripolsky (10:05):
At that point. So
Chris Picciurro, CPA (10:05):
We would we would ask him to be a sponsor
at that point. Nice. We namedthe studio after him.
John Tripolsky (10:10):
There you go.
Chris Picciurro, CPA (10:11):
That's up for grabs right now.
Brady Weller (10:13):
So QSPS is that's section 12 o two. I know you
mentioned the numbers early on.And some people, you know, when
you're Googling around, youmight see section twelve oh two,
which is the code text or youmight see qualified small
business stock, QSPS. Now, thereis another part of the code and
that's what our firm worksexplicitly on and that's the
number of the code is ten fortyfive and it's called QSPS
(10:36):
rollovers is what we call it.Some people call it a ten forty
five rollover.
And what that means is you canactually take the gains from the
sale of qualified small businessstock, the type of stock that I
described and you can reinvestthose gains into new qualified
small business stock. So if yourlisteners are familiar with the
ten thirty one exchange whereyou take gains from a sale of
(10:58):
property and roll it into likekind property, This is the ten
thirty one exchange for companystock. Now the reason why
someone would wanna do this isbecause when you do a QSPS
rollover, it allows you tocontinue your holding period,
meaning if you sell stock inyour company at year three and
(11:18):
you say, man I didn't reach thefive year period for the QSPS
exemption, now I owe taxes, youactually have sixty days to
reinvest that money into newstock and it will continue your
holding period. Maybe you holdthat new stock for four years,
so you're at a combined sevenand then you exit, now you can
take your exclusion becausethose holding periods tack on.
(11:39):
So it's extremely powerful butit's not powerful if there are
no good rollover options.
So traditionally it's like, heyI exited my startup at year
three, I have this big tax billbut I'm not gonna just go invest
in John's startup, like he'sgonna burn my money
statistically or they're gonnafail statistically, so that's
(12:00):
not a good tax planning tool,right? So when we step back and
we looked at the code here, wesaid, hey, why is there so much
infrastructure and help forpeople to execute other kinds of
tax exemptions and there's nonefor QSPS and QSPS rollovers? And
so we dreamed and we said, hey,what if there existed an always
(12:22):
available downside protected andhighly defensible option for
people to execute theserollovers? We think internally
that founders leave around$15,000,000,000 on the table
every year because they don'tmaximize QSPS. We will see about
$3,000,000,000 worth of exitvolume next year from founders
(12:43):
with this exact problem is ourestimate.
And from September to May, wesaw more than a billion dollars
just in the first, call it, sixmonths of us running our newest
program. Wow. Wow. Massiveproblem.
Chris Picciurro, CPA (12:56):
No. It is because I we I'm in being a CPA
firm owner for over twentyyears, most let's put this
aside. Most people that exittheir business or get an offer,
sometimes an offer that theycan't refuse to exit their
business, typically, c corpsaren't used as much, or they
didn't realize five years inadvance that they were gonna get
(13:19):
it. So the practical problemthat solves is I've got a c I've
got someone that's positioningas as a and and maybe elects for
their LLC to be taxed as a ccorp Mhmm. Two, three years ago,
you're solving the problem thatthey didn't see five who the x
sees five years in advance whenyou're a business person.
Right? So you're kinda helpingsolve that that problem for them
(13:40):
where
Brady Weller (13:40):
they could still qualify for the QSPS. Yeah. Now,
frankly, we work on the coastsjust because, like, venture in
New York or venture inCalifornia, and that's just
right down the fairway for folkswho are gonna qualify. But we're
seeing so much more in Chicago,in Denver, in Austin, in Miami,
in DC, Virginia, know, startupecosystems are blooming in those
(14:03):
places. Our bread and butter arethe coasts because that's how
sort of the capital is playedout, but if you have a pass
through entity, maybe you havean S Corp, you know a lot of
these family businesses lookingto exit in the next call it
three to five years or lookingto make a generational
(14:23):
transition in the next three tofive years, then you do sort of
have an idea of hey, can we movethings around, convert to a C
Corp, reissue some new stock,reformat things here as we plan
for an exit.
Now it doesn't work for everyindustry because you do need to
do a stock sale in order toexecute QSBS. So I know for many
(14:45):
of our listeners who haveservice businesses, any exit
just isn't going to be a stocksale, it's gonna be an asset
sale of some kind. But thereare, you know, ways that you can
fashion deals to make it work,and it it's certainly worth
exploring given the benefits.
Chris Picciurro, CPA (15:02):
And and a lot of the people that do more
more asset sales and stock salesmight be in an industry that
aren't gonna is not gonnaqualify for QSPS anyway. So
John Tripolsky (15:10):
It's possible.
Brady Weller (15:11):
Yeah. It's possible.
Chris Picciurro, CPA (15:11):
You're you know, that so can can talk can
you talk kinda through themechanics? So, obviously, you
know, someone that has aqualifying business, five year
hold period can exclude up tothe $10,000,000 of capital gain.
Remember, it has to be a and wehave some content on this, a
stock sale, not an asset sale.Now a lot of times, what we're
seeing in many of the industriesis stock sales are becoming a
(15:33):
little more prevalent becauseof, like, contracts. You you
might have a contract with anentity that's not transferable
to another one.
So that that could be the thatcould be the case, or the c corp
might have r and d creditscarrying forward or NOLs. You
know, there could be some taxattributes in that c corp that
the the acquiring company wouldlike. But how would can you tell
(15:55):
us about some maybe, you know, alittle more on the rollover
mechanics just from a, like, a30,000 foot PO game. Like, hey.
I've I've got a tell us a clientsuccess story.
Obviously, I'm gonna say what itmeans, but, yeah, that's that's
probably the best teller of ofsomeone that maybe has been
working for two or three yearsand
Brady Weller (16:14):
as a c corp or in in Well, we working out. We're
we're seeing these all the timeright now because of a the AI
boom. I've seen full exits inless than a year. I've seen, you
know, $100,000,000 plus seed inseries a rounds, which, you
know, are extremely large.Opportunities for founders to be
taking large amounts ofliquidity via secondary at
(16:36):
series a.
So mainly talking about venturebacked businesses here, and I
can tell you, give you an ideaof a success story from maybe a
place like New York where forlarger exits, the combined
federal and state tax rate canbe 35, 37%. And so on
$10,000,000, you're looking at a$3,500,000 tax bill. So say a
(16:59):
founder in New York exits for$5,000,000 at year three, they
have an AI business and theysold it to a larger company. At
$5,000,000 they're on the hookfor a 7 figure tax bill, taking
that money, literally the cashthat got wired to them, they
would come to typically ifthey're working with us, they
(17:20):
would come to us and say, hey, Iwanna do a QSPS rollover, we'd
say great, you have a couple ofdifferent options, You can make
an angel investment or deploycapital to an outside business.
We've described maybe not thebest for most people situations,
but there are two other thingsyou can do.
One, you can start your own newcompany and issue yourself stock
(17:42):
in a new business just like youdid when you founded your first
company and you can immediatelystart running that in a
qualified sector and that can beyour rollover. Or you can start
a new company and you can domarket research and development
work to go out and identify abusiness that you could acquire
or start. The IRS is actuallygonna give you a safe harbor
(18:05):
period, call it like a rollingtwo to three year ish period
where they're gonna say, hey,all of that research and
development, that startup work,that exploration for a business
to acquire, we're gonna callthat working capital for these
purposes and so you get QSBScredit for that. So that's a
really interesting option. Now,something you can't do is just
create a new c corp, throw moneyin there, sit in Cabo and say,
(18:28):
yeah, I'm emailing some folksabout buying their business.
Right. We believe that the baris extremely high for
substantiating these and thelarger the numbers get, a couple
$100,000, fine, but you get intoseveral million dollars, a
little bit harder tosubstantiate that yeah, I'm
actually going out and doing Rand D work. And so that's what
(18:49):
our firm does, We do end to endrollover compliance,
substantiate substantiation andmarket research in order to
justify the use of proceeds inyour new rollover entity.
Chris Picciurro, CPA (19:01):
It's a couple. Yeah. Oh, no. That makes
sense. So just like we talkedabout, it's you know, ideas are
cheap.
Implementation's valuable. Yep.So having the right
implementation partner like likeyour firm is important. You
can't I do have a question. Sowhen when someone does let's say
they're doing the QSPS rollover.
They sell their company stock.They get wired, you know, for,
(19:24):
let's say, $8,000,000. Does thathave to go through a call an
intermediary similar to a tenthirty one exchange, or can they
does it can it hit their bankaccount and then they they try
to do a rollover?
Brady Weller (19:36):
Yeah. It's actually they can just do it
directly, and it's fungible aswell, which means that you could
get that money, you could throwthat $8,000,000 in a treasury
account, then you could pull aline of credit off of it and use
the money from the line ofcredit. Like yeah, it's
completely fungible, $8,000,000and the rollover is a claim that
you would make on your scheduleD when you file your taxes. And
(19:59):
so someone has their exit that$8,000,000, they have that
$8,000,000 gain recorded,They're gonna work with their
CPA to write, you know, belowit. Basically, we're claiming
$10.45.
We're claiming a QSPS rolloverand a gain deferral. What that
means is if you do that withinsixty days, whether you roll
over $8,000,000 or $5,000,000whatever portion, you can claim
(20:23):
that as a deferral for theperiod that you're in that new
business. And then down theline, maybe you hold that stock
for another four years and thenyou get liquid again, pull it
out. At that point, you'll beable to claim your tax exemption
under section 12 o two on QSPS.So a rollover in itself is a
(20:43):
continuation of QSPS and taxdeferral, and then QSPS is
ultimately what gets you to theexemption.
Chris Picciurro, CPA (20:49):
Oh. And so if you're a tax professional and
you have clients out there thatyou think Brady and his his team
could work with, just reach outto us. If you're a business
owner, you're thinking aboutexiting. Are there are there I I
have two more questions, and Iknow we'll then we'll wrap it
up. Are there related any typeof, like, related party rules or
or, you know, let's say I'm aI'm selling my stock to, one of
(21:13):
my children.
Yeah.
Brady Weller (21:15):
Yes. That can come up and and really it's gonna
come up when we're talkingabout, yeah, related party sales
and conversions. So we wanna becareful with those transactions,
we wanna be careful with thepurchase, the sale, the
reissuance of stock, all thosesort of events that happen maybe
on the balance sheet of thecompany, whether they're
(21:35):
buybacks or redemptions, any ofthose types of transactions. If
you have QSPS in mind, you'regoing to want to work with
someone to pay attention to theimplications there. We have
maybe the broadest network inthe country of those 75 folks in
each camp, CPAs, attorneys,people who can help you navigate
that.
And we do free consultations interms of checking out your
(21:58):
situation and helping to pointyou in the right direction. So
if you've heard me talking aboutventure and you say, well, that
just doesn't apply, still worthreaching out and seeing what the
options could be.
Chris Picciurro, CPA (22:10):
And my final question is we wrap it up
because a lot of people, wantwould like to know. Oh, you
know, has has, OB three changedor or or allowed this to
continue? Is this something thatwe have to do in before 2026?
What's the future of of QSBSlook like kind of, you know,
(22:32):
that from a broader view?
Brady Weller (22:35):
Yeah. Section 12 o two of QSBS started in '93. It
was expanded to where it iswell, was earlier this year by
the Obama administration in2010, 2011, and then it's been
expanded again. And so back whenit was expanded maximally the
first time, it was a Democraticadministration, Democratic
(22:56):
Senate. Now we have it in aRepublican White House and
Republican Senate, expanded onceagain, seen bipartisan support
for twenty five years or more,and rollover is the same.
Rollovers were implemented in1997. So we're extremely
confident in the long termhealth of QSPS. It's clear that
both sides of the aisle want toincentivize innovation and
(23:19):
entrepreneurship and deploymentof capital. So yeah, OBBBA made
QSPS even more powerful, itexpanded the exclusion cap from
$10,000,000 to $15,000,000 perperson per issuer, and it
expanded the gross asset test.So when you talk about small
business, these businessesissuing eligible stock have to
(23:41):
be, used to have to be under$50,000,000 in gross assets,
that's been expanded to$75,000,000 which means that for
venture backed businessesprobably up to series B and
maybe even beyond depending onthe size of fundraisers, they're
gonna keep issuing that eligiblestock.
And the last thing is there'sbeen a tiered exemption
(24:03):
implemented, which means that ifyou have stock issued after July
4, when this went into effect,even if you hold for three
years, you can take a 50%exclusion, four years a 75%
exclusion, and five years that100% tax exclusion up to
$15,000,000 goes into effect.So, yeah, that's all stock
(24:24):
issued after July 4. For mostpeople we're talking to, that's
just not in play yet. But overthe next year, one to three
years, we're gonna start seeinga ton of folks in that camp.
Chris Picciurro, CPA (24:36):
That is awesome. Well, thank you so
much. And, John, I know you'regonna put a lot of Brady's
information in our in our notes.What's the best way to reach out
to you and the team at QSPSrollover?
Brady Weller (24:49):
We're easy to find, qsbsrollover.com. It's
easy to schedule a call with us.Both my co founder and I and our
our team are available to chatwith anyone at any time. Happy
to work through your situation.You can follow us on LinkedIn.
We're pretty active there.Follow me on LinkedIn. I post
funny stories about peoplemissing out or being able to
(25:10):
take advantage of QSPS. So lookforward to seeing people. Nine,
muted.
Chris Picciurro, CPA (25:24):
You're muted.
John Tripolsky (25:25):
Oh, there we go. Holy cow. Talk about missing out
on things. Here I am. I mutedmyself, and I'm talking about
missing I was gonna say thereprobably the the examples that
you give of people missing outis absolutely hilarious at some
point, but to other people, notto them.
So we'll definitely drop yourcontact in there. I know this we
could we could take this downprobably many avenues, many
(25:46):
examples of of diving intospecific stuff. So I'd probably
say and tell me if I'm correctis if anybody has these
questions a little bit more indetail, you know, the we just
skimmed the iceberg, basically,on this one.
Brady Weller (25:58):
Absolutely.
John Tripolsky (25:58):
Any of those questions reach out to you
directly, and you guys coulddive into those on a really at a
case by case basis. Correct?
Brady Weller (26:03):
100%. Yep.
John Tripolsky (26:05):
Yep. Awesome. Awesome. Well, thanks for
joining us. I appreciate it.
And, Chris, hopefully hopefully,you know, this guest we have
here stood up to your, yourexpectations on the topic. So
now we
Chris Picciurro, CPA (26:15):
Oh, I had no doubt he would. So We don't
have
John Tripolsky (26:17):
to get you, you know, a little cheese plate and
play the fiddle for you. Youshould be okay. So awesome.
Chris, thanks for theintroduction to him. Ray, thanks
for joining us, man.
We'll again, we'll drop yourcontact in there. And, if
anybody has those questions,drop him a line, him and his
business partner. Again, don'tbe lazy. Right there in the show
notes and down here and off tothe side, depending on what
(26:39):
platform you're looking at.Check it out, and we will see
everybody back here again nextweek.
Different date, same day of theweek, completely different topic
here on the Teaching Tax Reformpodcast. Have a great week,
everybody.
Disclaimer (26:56):
The content provided is for educational purposes
only. We encourage you to seekpersonalized investment advice
from your financialprofessional. For all tax and
legal advice, please consultyour CPA or attorney. Investment
advisory services are throughCabin Advisors, a registered
investment advisor.
Securities are offered throughCabin Securities, a registered
broker dealer. The content ofthis podcast does not constitute
(27:16):
an offer of securities.Offerings can only be made
through an offering memorandum,and you should carefully examine
the risk factors and otherinformation contained in the
memorandum.
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