Section 1202 Qualified Small Business Stock (QSBS)

A tax provision that may allow you to exclude some or all of your capital gains when you sell stock in a qualifying C corporation, up to a per-company limit. For stock issued after July 4, 2025, the exclusion is 50% if you hold it three years, 75% after four years, and 100% after five years. For stock issued earlier, you generally must hold it at least five years to qualify.