Section 1202 Qualified Small Business Stock: OBBBA’s Expanded Benefits and Opportunities

Mark A. Melton, Partner | Holland & Knight

Mark A. Melton is a partner in Holland & Knight’s Dallas office and co-chair of the firm’s Tax, Executive Compensation and Benefits Practice Group. He advises on Section 1202 qualified small business stock (QSBS) issues and on the federal income taxation of domestic and international transactions of private equity and hedge funds, other investment partnerships, joint ventures, real estate investment trusts (REITs), and operating businesses.

• Education & Credentials

Mr. Melton earned his J.D., cum laude, from Southern Methodist University Dedman School of Law, an M.S. in Taxation from The University of Texas at Arlington, and a B.B.A., with honors, from The University of Texas at Arlington. He is a certified public accountant (CPA) and a Level II candidate in the Chartered Financial Analyst (CFA) program. He is admitted to practice in Texas and before the U.S. District Court for the Northern District of Texas and the U.S. Tax Court.

• Recognition & Leadership

Mr. Melton is recognized in The Best Lawyers in America for Tax Law (2026, 2027) and Corporate Law (2024–2027), in Chambers USA for Tax (2026), and in The Legal 500 USA for Tax – U.S. Taxes (2023, 2025, 2026) and Tax – International Tax (2025). He was named to Lawdragon 500 Leading Global Tax Lawyers (2025) and Texas Super Lawyers (2021–2025). He received the SMU Dedman School of Law Distinguished Alumni Award (2024) and the ABA Pro Bono Publico Award (2022), and he co-chairs Holland & Knight’s Tax, Executive Compensation and Benefits Practice Group.

• Professional Involvement

Mr. Melton is a member of the American College of Tax Counsel, the Dallas Bar Association, and the Texas State Bar Association. His firm multimedia on qualified small business stock includes “Assessing Risk and Complexity with QSBS” and “The Power of Qualified Small Business Stock.”

• Experience

Mr. Melton’s practice centers on Section 1202 QSBS issues and the federal income taxation of private equity and hedge funds, investment partnerships, joint ventures, REITs, and operating businesses. He assists clients with investment fund formation, mergers and acquisitions, real estate investment and development, and financial instruments and derivatives, and he handles complex partnership allocations, cross-border investments, and investments by sovereign wealth funds and other institutional investors. Before entering private practice, he served as a fund tax manager for a multibillion-dollar international private equity group.

SESSION 1 – Qualifying for the Section 1202 Exclusion After the 2025 Tax Act | 12:00pm – 1:00pm

This session examines how the One Big Beautiful Bill Act (P.L. 119-21, signed July 4, 2025) expanded the Section 1202 qualified small business stock exclusion, how to trace QSBS eligibility from issuance through exit under the qualified small business, active business, and redemption rules, and how the new tiered holding-period and exclusion-cap architecture applies to stock acquired before and after July 5, 2025.

BREAK | 1:00pm – 1:10pm

SESSION 2 – Preserving QSBS Through Pass-Through Structures, Transfers, and Reorganizations | 1:10pm – 2:10pm

This session examines how the Section 1202 exclusion is applied and preserved once QSBS is held through partnerships, funds, and holding companies, including partner-level limitations, the transfers that carry the exclusion and the transfers that destroy it, and the incorporation, rollover, and reorganization structures practitioners are using and misusing after the One Big Beautiful Bill Act (P.L. 119-21