Section 1045 lets non-corporate taxpayers defer capital gains from a QSBS sale by reinvesting proceeds into new qualifying small business stock within 60 days. After the 2025 OBBBA expansion (75M gross assets cap, tiered 50/75/100 percent exclusion at 3/4/5 years), the rollover can convert a missed Section 1202 exclusion into a deferred, and potentially excluded, gain.
Form 7203 forces S-corp shareholders to prove their stock and debt basis on Form 1040. Misapplying the ordering rules or treating loan guarantees as debt basis can disallow loss deductions, reclassify distributions as capital gains, and trigger 20% accuracy penalties.
Section 1014 of the Internal Revenue Code resets an inherited asset's cost basis to its fair market value on the date of death, erasing the decedent's lifetime appreciation from the tax base — a provision the Joint Committee on Taxation estimates will cost the federal government $72.5 billion in 2026.
A Section 83(b) election lets founders and early employees pay ordinary income tax on the grant-date value of restricted stock instead of on each vesting tranche, shifting future appreciation into long-term capital gains. The 30-day filing window is absolute and starts on the actual transfer date.
How qualified versus disqualifying dispositions change the tax bill on a Section 423 ESPP, with worked examples covering ordinary income, adjusted basis, Form 3922 cost-basis fixes, and a decision framework for when holding two years actually pays off.
Incentive Stock Options and Non-Qualified Stock Options trigger taxes at different events and rates. This guide covers the AMT trap, qualifying vs. disqualifying dispositions, the $100,000 ISO vesting limit, and eight strategies tech workers use to lower the tax bill on equity compensation.
Section 1244 of the Internal Revenue Code lets qualifying small business stock losses be deducted as ordinary losses up to $50,000 per year for single filers and $100,000 for joint filers, bypassing the $3,000 annual cap on capital losses. This guide covers the corporate and shareholder requirements, how to claim the loss on Form 4797, and the documentation traps that disqualify ordinary-loss claims.
S corp basis determines how much of your losses you can deduct and when distributions become taxable. This guide covers stock basis vs. debt basis calculations, Form 7203 requirements, the order of adjustments prescribed by the IRS, and five common mistakes that permanently cost shareholders thousands in disallowed deductions.
Understanding shareholder basis is crucial for S corporation founders. This guide clarifies what basis means, its impact on tax deductions, and how to effectively track it using Beancount.io.
Take control of your finances with our open-source double-entry accounting system. Start your ledger today.
© 2019 - 2026 Beancount.io
