The § 1202 exclusion of gain on disposition of S corporation stock is not available.

Question

Quizplus · Accepted Answer

The § 1202 exclusion applies only to the disposition of qualified small business stock (QSBS), which S corporation stock is not. S corporations are considered pass-through entities for tax purposes, meaning the gains and losses are passed through to the shareholders on their individual tax returns. Therefore, any gains on the disposition of S corporation stock would be subject to the applicable capital gains tax rates for the shareholders.

The § 1202 Exclusion of Gain on Disposition of S