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QSBS Section 1202 Exclusion Calculator (50, 75, 100 Percent Tiers)

What do these figures come to once the work is shown?

Excluded gain on qualified small business stock by holding period, with the $15 million or 10 times basis cap and the $75 million gross asset check.

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Your figures
Example figuresIllustrative only. Type over them with your own.
Excluded gain
$6,000,000
Gain excluded from gross income under section 1202
Gain still taxable
$2,000,000
Exclusion percentage
75.00%
Drawn to one scale
Excluded gain$6,000,000
Gain still taxable$2,000,000
Per-issuer gain cap$15,000,000
All results
MeasureResult
Excluded gain$6,000,000
Gain still taxable$2,000,000
Exclusion percentage75.00%
Per-issuer gain cap
Greater of the dollar limit or 10 times basis
$15,000,000
Gross asset testWithin $75,000,000 (or not entered)
How this was worked out
Work shownrecomputed as you type
Eligible gain = min(gain, max(dollar limit, 10 x aggregate basis)); dollar limit $15,000,000 for stock acquired after July 4, 2025, else $10,000,000
Excluded = exclusion percentage x eligible gain
Percentage after July 4, 2025: 50% at 3 years, 75% at 4 years, 100% at 5 years or more
Percentage Sept. 28, 2010 to July 4, 2025: 100% when held more than 5 years, otherwise 0%
Aggregate gross assets of the issuer: $75,000,000 or less for stock issued after July 4, 2025, $50,000,000 or less before

Illustrative arithmetic on the figures you enter. Check the result against your firm's methodology before relying on it.

The formulas

  • Eligible gain = min(gain, max(dollar limit, 10 x aggregate basis)); dollar limit $15,000,000 for stock acquired after July 4, 2025, else $10,000,000
  • Excluded = exclusion percentage x eligible gain
  • Percentage after July 4, 2025: 50% at 3 years, 75% at 4 years, 100% at 5 years or more
  • Percentage Sept. 28, 2010 to July 4, 2025: 100% when held more than 5 years, otherwise 0%
  • Aggregate gross assets of the issuer: $75,000,000 or less for stock issued after July 4, 2025, $50,000,000 or less before

How it works

Section 1202 lets a noncorporate holder of qualified small business stock exclude part or all of the gain. For stock acquired after July 4, 2025 the exclusion is 50 percent at three years, 75 percent at four years and 100 percent at five years or more. Stock acquired earlier in the 100 percent window needs more than five years.

The gain taken into account per issuer is limited to the greater of the dollar limit ($15,000,000 for newer stock, indexed after 2026) or 10 times the aggregate adjusted basis of the issuer stock sold that year. The issuer aggregate gross assets cannot exceed $75,000,000 (stock issued after July 4, 2025) or $50,000,000 (earlier stock) at any time before and immediately after issuance. The dollar limit is also reduced by gain taken into account in earlier years, which this tool does not track. Active business, C corporation and original issuance rules are not tested here, and stock acquired before September 28, 2010 uses other percentages not covered.

Illustrative figures only. Check the result against your firm's methodology before relying on it.

Common questions

Does this tool test whether the company qualifies?

Only the gross asset amount if you enter it. The active business and entity rules need your own review.

What is the dollar limit for married filing separately?

The statute splits it, with $5,000,000 for the older tier and $7,500,000 for the newer tier. Enter your own share of gain accordingly.

Is the cap per issuer?

Yes, it applies to all dispositions of one issuer stock by you, so use total basis for that issuer.

Sources

Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.

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