I am in the early stages of determining the structure for my self funded search. (have a deal under exclusivity). I am learning about the QSBS structure and curious why this structure isn't used more frequently. It seems that the structure makes a ton of sense if you have a 5-7 year hold period and do not plan to take distributions ahead of exit (e.g. use max leverage for the initial purchase and paydown debt during 5 year hold or use cash for growth),
Are there any considerations that folks are concerned about? I'm aware of (i) the stroke of pen risk and that some members of congress are trying to eliminate this exclusion (though I think fairly easy to switch to S Corp if the exclusion is eliminated from tax code), (ii) double taxation given you need to structure as C-Corp (though non-issue if you don't take distributions), and (iii) some business are excluded from this exclusion (financial, tax, etc.).
Thanks all in advance for the help!
Qualified Small Business Stock Exclusion
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