IRC Section 1244 question: Can someone please clarify I.R.C. § 1244(c)(3)(A)'s "For purposes of this section, a corporation shall be treated as a small business corporation if the AGGREGATE AMOUNT OF MONEY and other property received by the corporation for stock, as a contribution to capital, and as PAID-IN SURPLUS, does not exceed $1,000,000. The DETEMINATION under the preceding sentence shall be made AS OF THE TIME OF THE ISSUANCE of the stock in question but shall include amounts received for such stock and for all stock theretofore issued."
I think it means that once any/all investments in small start up company securities pass $1 million, no further investments can be treated as Section 1244 - regardless of whether the company has continually lost money and there is never a yearly average balance of more than $1 million. But others are telling me that stock issuances are allowed subsequent to the initial $1 million threshold - if at the time of the new issuances, the company's balance is below $1 million
