Founder Focus Resource Center
Welcome to the Founder Focus Resource Center, where you will find unique content on topics of interest to founders and entrepreneurs and their professional advisors. A description of the full range of our legal services for founders can be found here.

Founder Focus On:

• Employment Law Compliance for Start-Ups
  Before launching a new business idea, founders should address employment law compliance to prevent potential future liabilities.
• New York Proposal to Tax QSBS Gains
  A New York State proposal aims to decouple NY tax law from the federal QSBS regime under IRC §1202 to eliminate state QSBS benefits.
• Avoiding Trade-Secret Allegations During a Founder Transition
  Founders seeking to avoid trade-secret allegations and IP disputes when they leave their companies should take practical steps to mitigate risk before making any moves.
• Valuing Private Shares
  Care should be taken to harmonize both IRC §409A and gift tax valuations to aid in planning and defensibility in valuing company stock.
• Changes to QSBS Rules
  The One Big Beautiful Bill enacted significant founder-friendly changes to IRC §1202, with expanded eligibility and exclusions for QSBS benefits.
• Section 83(b) Elections — Should You Pay Taxes Now?
  In the case of an exit, founders of startups and early-stage companies can potentially lower taxes paid on equity appreciation using 83(b) elections when a restricted equity award is issued.
• Transition Agreements
  For founders seeking to leave their companies, a timely and thorough transition agreement is essential.
• Cross-Border Issues for Founders with U.S. Companies
  Certain trust structures can be employed to provide QSBS stacking and other tax benefits to non-U.S. citizen founders with companies in the U.S.
• Key Employment Issues for Founders
  Whether or not founders have employment agreements, they should be familiar with several key employment concepts to avoid complications.
• 501(c)(4) Organizations: Giving with an Edge
  A lesser-known form of tax-exempt entity provides an alternative structure for founders who wish to engage in certain forms of philanthropy that may not be available to 501(c)(3)s.
• QSBS Rollovers
  IRC § 1045 of the Internal Revenue Code provides certain tax benefits for the rollover of proceeds from a QSBS sale.
• Introducing the GOAT Trust
  The unique structure of a GOAT Trust provides a founder with tax benefits while preserving the founder's access and control over the trust.
• Donations of Private Stock: Timing is Everything
  Donations of private company stock can be a useful tax planning tool, but it is important that a founder be mindful of the timing of a donation to ensure the greatest tax benefits.
• Avoiding a Trap for the Unwary: Gains from Secondary Sales Treated as Compensation
  Sales of stock in the secondary market as a means of accessing cash prior to an offering or exit risk being treated as compensation for services subject to tax as ordinary income.
• Equity Compensation: Stock Options and Restricted Stock
  Stock options and restricted stock are useful tools to help early-stage companies attract talent.
• Five Situations When Founders Should Consider Engaging Their Own Legal Counsel
  A founder should be aware of certain situations where the founder's personal interests may not be aligned with the interests, in which case the founder would benefit from engaging their own legal counsel.
• Structuring a Home Purchase
  When deciding whether to buy a home through an entity or in a founder’s own name, there are important things to consider.
• Direct Investing: Structuring Family Investments in High-Growth Companies
  Founders and entrepreneurs should consider when the capital of a family trust should be deployed for direct investments in their startups and early-stage companies.
• Investing for Impact: Opportunities for Entrepreneurial Philanthropy
  Founders should consider program-related investments and mission-related investments as alternatives to advance charitable causes.
• Tax Benefits of Advance Planning
  Founders should start estate planning early to ensure maximum tax benefits.
• The GRAT: A Powerful Tool for Tax-Free Wealth Transfer
  The Grantor Retained Annuity Trust (GRAT) is an effective option for founders seeking to transfer wealth to beneficiaries.
• Estate Planning for Founders and Investors in Venture-backed Companies: Transfers of Qualified Small Business Stock by Gift (New York State Society of Certified Public Accountants)
  Stacking strategies present high impact opportunities to shelter gains from the sale of stock from taxes.
• Playbook for Advising Young High-Net-Worth Entrepreneurs (Wealth Management's Trusts & Estates Magazine)
  Strategic income tax planning for young founders demands a unique approach that doesn’t foreclose traditional estate tax planning.
• Digital Asset Estate Planning, Tax Strategies, and Trust Structures: Navigating Crypto Wealth Management (Data Bird Business Journal) High-net-worth individuals can use tailored trust structures and tax strategies to protect and optimize crypto wealth across generations in a complex regulatory environment.
• Friends of Founders: Trust/Estate Planning and Founder Focus, with Michael Arlein (QSBSrollover.com) Startup founders can use proactive trust and estate planning in connection with QSBS to advance their wealth preservation goals, optimize tax outcomes, and prepare for liquidity events.
• New York Tech Founders and Investors Mobilize to Fight Proposed Capital-Gains Tax Hike (The Wall Street Journal) The New York State Senate’s 2026-2027 budget proposal includes a provision that would impose city and state income tax on gains from startup exits, which are currently excluded from federal taxes.
• New York Tax Push on Startup Investments Draws Tech Sector's Ire (Bloomberg)
• Bridging Section409A And Gift Tax Valuations (Wealth Management)

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Video and Podcast Library: The Founder Focus team is often invited to present on founder strategies. Below are links to several of these videos and podcasts.

• Beyond the Sale: Strategic Planning for Business Owners
• QSBS Solved: Founder-Focused Trust, Estate, and QSBS Planning
• VetVet Expert View: Trusts & Estates
• Tax and Estate Planning Strategies for Founders
• Don't Wait Until It's Too Late: Estate Essentials for Wealthy Individuals (Serious Coin Podcast)
• QSBS For Founders (Wealth, Actually Podcast)

External Resources:

• 26 U.S. Code § 1202 - Partial exclusion for gain from certain small business stock (Cornell Law School, Legal Information Institute)
• 26 U.S. Code § 1045 - Rollover of gain from qualified small business stock to another qualified small business stock (Cornell Law School, Legal Information Institute)

Founder Focus Gives Back:  A commitment to public service is a central principle of Patterson Belknap and the Founders & Entrepreneurs Practice Group. Our attorneys provide pro bono assistance to entrepreneurs from all backgrounds as they build their businesses. We work closely with the Volunteers of Legal Services (VOLS) Microenterprise Project, Legal Aid Society and Church Avenue Merchants Block Association (CAMBA), among others, to help entrepreneurs from underserved communities form and manage their businesses.