**UPDATED December 18, 2010 at 9:00 a.m.** The proposed legislation referenced below that would extend the 100% tax for capital gains (and alternative minimum tax) on QSBS was signed by the President on Friday.  Accordingly, the 100% QSBS tax break now runs through the end of 2011.  Here is a good summary of the various items included in the Tax Relief Act of 2010.

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Just a reminder that the temporary 100% tax exclusion for capital gains (and alternative minimum tax) on Qualified Small Business Stock (“QSBS”) is set to expire at year end. In October, we prepared a summary of the temporary QSBS legislation, which is available here. In our prior post, we guessed that the law may be extended before it expires. Late last week, the Senate released proposed legislation that, if adopted, would extend the 100% tax exclusion through the end of 2011. Joe Wallin’s blog covered the proposed legislation here. For the startup community’s sake, let’s hope this piece of the proposed legislation makes it into law by year end.