The IRS just published the first inflation adjustments to the expanded QSBS rules from last summer’s One Big Beautiful Bill Act. If you are raising, issuing, or planning an exit around qualified small business stock, update your numbers.
Revenue Procedure 2026-35 (announced in IR-2026-133 on November 5, 2026) adjusts two §1202 figures for taxable years beginning in 2027:
- Per-issuer indexed dollar limit on eligible gain for stock acquired after July 4, 2025: $15,480,000 (up from the statutory $15,000,000).
- Aggregate gross assets ceiling used for the qualified small business corporation test: $77,390,000 (up from the statutory $75,000,000).
Those are the official 2027 amounts. Cite Rev. Proc. 2026-35, section 3.42. The statute that put indexing into §1202 is section 70431 of Public Law 119-21 (the OBBBA).
Quick refresher on which caps move
Congress did not just raise the old $10 million / $50 million figures once. For stock acquired after the July 4, 2025 enactment date, the per-issuer exclusion starts at $15 million and, for years beginning after 2026, gets a cost-of-living bump (2025 base year, rounded to the nearest $10,000). Same idea for the $75 million aggregate gross-assets test that applies to stock issued after enactment.
The older $10 million per-issuer limit still matters for stock acquired on or before July 4, 2025. That legacy figure is not what Rev. Proc. 2026-35 is indexing here.
One statute wrinkle worth remembering: once a taxpayer has already used up the applicable dollar limit for a particular issuer on post-enactment stock, a later inflation increase does not reopen room under that issuer’s cap.
What this means in practice
Founders and boards. If you expect to issue stock in a taxable year beginning in 2027, the “are we still a qualified small business?” asset-test conversation should use $77.39 million, not $75 million. That is not a huge delta, but it is real money on a late-stage primary or a large secondary-adjacent raise where gross assets are close to the line. Measure aggregate gross assets the way §1202(d) always required—before and immediately after the issuance—and build the new ceiling into the checklist.
Shareholders and sellers. The indexed dollar limit does not shorten the holding period. For calendar-year taxpayers, stock acquired after July 4, 2025 cannot qualify for the new three-year exclusion until 2028. Use the indexed limit applicable to the sale year. The 2027 indexed dollar limit on eligible gain is $15.48 million (half of that on a married-filing-separately return, under the statute’s separate-return rule). Section 1202 generally limits eligible gain to the greater of the remaining per-issuer dollar limit or 10 times qualifying adjusted basis. The applicable holding-period percentage then determines how much gain is excluded. Stacking, gifting, and trust planning are still in the commentary-and-risk zone; Treasury has not dropped anti-stacking guidance in this package. Do not treat a blog roundup as a green light.
Counsel. Update term-sheet footnotes, QSBS representation packs, and investor FAQ one-pagers. Point to Rev. Proc. 2026-35 §3.42 and IR-2026-133. If a client’s model still says “$15M / $75M forever,” fix the model. Indexing is annual from here.
What did not come out
This release is the ordinary year-end inflation Rev. Proc., not new QSBS regulations, a stacking notice, or a revenue ruling on trust planning. No Federal Register hit for “qualified small business stock” tagged to this drop. The news is the indexed dollars themselves—the first time the post-OBBBA QSBS math has moved.
Bottom line
For 2027 planning: $15.48 million indexed dollar limit on eligible gain (post–July 4, 2025 acquisitions) and $77.39 million aggregate gross assets. Bookmark the Rev. Proc. 2026-35 PDF, update the checklists, and keep watching for actual guidance on the hard open questions. The caps just got a little bigger. The documentation burden did not get smaller.
