Not every startup can tap into the huge tax advantages of Qualified Small Business Stock (QSBS), and in this episode, we’re breaking down exactly why. Join us as we unpack Section 1202 of the tax code and spotlight all the types of businesses that don’t qualify for QSBS, including law firms, healthcare providers, consulting companies, finance, hospitality, and more. If you’re building a business or planning a QSBS rollover, knowing these exclusions can save you from making a costly mistake.

We’ll walk through what the IRS means by “excluded activities,” explain the active business requirements, and clear up common misconceptions, like whether consulting or software businesses are really in the danger zone. If you want to know whether your business is QSBS-eligible before your next big exit, this episode gives you the practical breakdown founders, investors, and advisors need.

If you’re in the startup world and looking to maximize your QSBS benefits, this is a must-listen.

Contact: Brady@QSBSrollover.com | www.QSBSrollover.com

This episode of QSBS, Solved is a repost of an interview featuring Brady Weller, Director of QSBSrollover.com, conducted by Earnest Sweat of Swimming with Allocators. SWA is a podcast delving into the strategies and perspectives of leading allocators in the VC space. Designed for fund managers and fellow allocators, the show offers a deep dive into the methodologies and approaches adopted by prominent players in the industry. The conversations are rich, and enlightening, and cover a wide range of topics relevant to the venture asset class from an LP's viewpoint.

Earnest Sweat is the Founding Partner of Public School Ventures, a dynamic syndicate of over 600 technical operators, go-to-market specialists, and LPs. Previously, Earnest built new venture capital practices at Prologis and GreatPoint Ventures. His focus is on investing in value chaintech, specifically vertical SaaS, applied AI, middleware, and B2B marketplaces, which are poised to revolutionize foundational industries like real estate, insurance and supply chain. Earnest has sourced and led investments in companies such as Flexport, Flexe, KlearNow, and Lula Insurance.

Contact: Brady@QSBSrollover.com | www.QSBSrollover.com

On today’s episode of QSBS Solved, we break down the essential facts about Qualified Small Business Stock—QSBS—and why it’s such a powerful tax-saving tool for startup founders, investors, and early employees. From the requirements for a company to issue QSBS, to the types of businesses that are excluded, we cover everything you need to know about eligibility, the $50 million asset test, the five-year holding period, and how much gain you can actually exclude. We also highlight potential pitfalls, like stock redemptions, and explain how a QSBS rollover (under Section 1045) can help you keep your tax advantage, even if you exit early.

If you want to learn how founders and shareholders in places like New York can potentially eliminate their capital gains tax bill—sometimes as high as 37%—this episode is for you. Whether you’re just hearing about QSBS for the first time or looking to refine your exit strategy, we’ll make sure you’re ready to protect your gains and maximize your upside.

Contact: Brady@QSBSrollover.com | www.QSBSrollover.com