Erik purchased qualified small business corporation stock on December 1,2010 and sold it for a $500,000 gain on December 12,2019.The gain subject to tax is

Question

Quizplus · Accepted Answer

Under the IRS rules for Qualified Small Business Stock (QSBS), if the stock was held for more than five years, up to 100% of the gain can be excluded from taxable income, subject to certain limits. Erik held the stock for over nine years, so the entire $500,000 gain can be excluded from tax.

Erik Purchased Qualified Small Business Corporation Stock on December 1,2010