The $10 Million Question: Are You About to Lose the Best Tax Break in the Code?

Qualified Small Business Stock (QSBS) is one of the most powerful tax strategies available to founders, investors, and early startup employees—yet most people either don’t know it exists or can’t prove they qualify when it matters most.

If you’re holding startup shares, here’s the big opportunity:

Sell up to $10 million in gains—completely tax-free. Yes, zero federal capital gains tax under IRC Section 1202.

But like most of the tax code’s best gifts, there’s a catch: it only works if you document it right.

What Is QSBS?

To qualify for this break:

• The company must be a U.S. C-Corp with gross assets < $50 million when shares were issued.

• The shares must be purchased directly from the company—not secondhand.

• You must hold them for at least 5 years.

• The company must be in a qualified active business (not services or finance).

If you clear these hurdles, the potential is massive:

$10 million (or 10x your basis, whichever is greater) of tax-free capital gains.

So Why Do People Lose This?

Most often, it’s not because they didn’t qualify. It’s because:

• They didn’t know about QSBS until it was too late.

• They can’t prove they met the criteria.

• Or a merger/acquisition invalidates their claim without the right documentation.

You don’t want to explain that to the IRS.

You want to show them.

How MakeItDeductible.ai Protects Your QSBS Claim

We help smart investors go from “I think I qualify” to “Here’s the evidence.”

✅ Timestamped documentation of stock purchase

✅ Confirmations of company asset levels at time of issue

✅ Ongoing proof the business is “active” and compliant

✅ Uploads of board minutes, legal memos, cap tables, and more

You’ll have a real-time audit-proof file—built with just texts, photos, or quick uploads.

Ready for the $10 Million Test?

Most founders don’t fail because they’re reckless. They fail because they’re too busy, and no one built them a tool to keep this organized.

We did.

👉 Take the XeDuct Score™ – Free Tax Fitness Check

See if your QSBS claim is bulletproof—or full of holes.