Alvarez & Marsal Tax is helping small businesses to navigate through the COVID-19 crisis to best position owners for both near and long-term savings. Chief among them, the opportunity to leverage present valuations to lock in the substantial future benefits afforded by the Qualified Small Business (QSB) Stock regime. In short, under the QSB rules, a conversion from a pass-through structure (partnership, LLC, etc.) to a corporate (C-corp.) structure could allow owners to substantially reduce their tax bill upon eventual exit of the business (through up to $500 million of U.S. tax gain exclusion).

Now may be the optimal time for you to consider a C-corp. conversion/QSB stock issuance if:

• You run a U.S. business in a pass-through solution (excluding certain health, consulting, financial/legal services, and hospitality businesses);
• Your business’ current value is less than $50 million; and
• You plan to hold your business for at least five more years.

Sound like your profile? Reach out to Alvarez & Marsal Tax to discuss specific applicability and savings potential.

To find out more about our Qualified Small Business Stock Services, click here. 

Click here to read a recent article on Qualified Small Business Stock. 

Click here to learn more about Emerging Companies: R&D Small Business.