Priced round closes Friday. Wire lands Monday. Your shares just got a 10X markup, on paper. Here are the 5 estate moves to make before the wire hits, while your shares are still cheap to gift.
The term sheet is signed. The lawyers are papering the docs. The wire hits Monday. And the moment that priced round closes, your founder shares get a 10X markup on paper, which means every estate planning move you make from that day forward uses your gift exemption against the higher number instead of the lower one. The window where shares are still cheap to gift, still pre-409A-spike, still inside the QSBS-friendly issuance period, is narrow and closing fast.
Most founders skip this entirely. They watch the shares revalue, they let the exemption tick by, and they discover years later, at the exit, that they could have moved tens of millions out of their taxable estate by signing a few trust documents during the week the round was being papered. This is the playbook for the 30 days around the close, with the moves that matter most concentrated in the days before the wire hits.
Gift founder shares before the priced round closes and you use gift exemption against the prior 409A or seed-stage valuation. Gift the same shares after close, and you use exemption against the new post-money valuation. On meaningful rounds, the difference is six to seven figures of additional exemption preserved, which compounds enormously by exit.
This is the highest-leverage move in early-stage estate planning, and the one most founders do not make. Founder common stock, before a priced round, is typically valued at a small fraction of the preferred price. The 409A valuation captures part of that discount, the actual fair market value for gifting purposes captures even more. Once the round closes and the new preferred price prints, every share you own ratchets up in implied value, even if your common stock 409A does not move proportionally.
If you can get gifts to a trust on the books before the round closes, you have used your 2026 lifetime gift exemption (currently $13.99M per person) against the lower valuation. The shares then continue to appreciate inside the trust, outside your estate. By the time the company exits, the trust may hold tens of millions in value that never touches your taxable estate. Done at scale, this is the difference between leaving your kids a meaningful inheritance and leaving the IRS the lion's share.
Before you do any gifting, confirm that you actually filed your 83(b) election within 30 days of receiving your founder shares. The 83(b) election is what locks in the cost basis at the issue date and starts the long-term capital gains and QSBS holding-period clocks. If you missed it, your shares vest into ordinary income at the value at vesting, which destroys most of the planning that follows.
If the 83(b) was filed, find the certified mail receipt and the IRS acknowledgment, scan them, and store them somewhere you can find in 10 years. Every gift, every trust contribution, every QSBS calculation depends on the 83(b) being valid. Co-founders who skipped this step at incorporation can sometimes correct it, but the path is narrow and the planning gets meaningfully harder.
The two main vehicles for moving founder shares out of an estate are the GRAT (Grantor Retained Annuity Trust) and the IDGT (Intentionally Defective Grantor Trust). Both work. They work differently.
A GRAT is structured so you contribute the shares, receive an annuity stream back for a fixed term, and any appreciation above the IRS Section 7520 hurdle rate passes to the remainder beneficiaries (your kids or a trust for them) gift-tax-free. The beauty is that a GRAT can be "zeroed out," meaning you use almost no gift exemption to set it up. The cost is mortality risk: if you die during the term, the assets pull back into your estate. Short-term rolling GRATs work well for early-stage founders because you get repeated chances to capture appreciation while limiting the mortality window.
An IDGT is structured so you sell shares to the trust in exchange for a promissory note. The shares grow inside the trust, you continue to pay income tax on the trust's earnings (which itself is a tax-free gift), and the note value is what stays in your estate while the upside flows to the beneficiaries. The IDGT typically requires a small "seed" gift up front to give the trust economic substance, but it does not have the mortality cliff of the GRAT.
The right answer is usually a combination: GRATs for the publicly observable, near-term appreciation events; an IDGT for the long-hold, illiquid founder shares that you expect to compound for years before any liquidity. Our walk-through on how to fund a living trust covers the operational mechanics of moving assets into the structures cleanly.
Qualified Small Business Stock under Section 1202 is the largest tax break in the founder world that almost no one optimizes correctly. If your shares qualify (C-corp, gross assets under $50M when the shares were issued, original issuance, qualified trade or business), you can exclude up to $10M of capital gains, or 10X your basis, whichever is greater, from federal tax at exit. Most founders know this number.
What most founders miss is the stack. Each non-grantor trust funded with QSBS shares before the gain is realized can have its own $10M cap. Gift QSBS shares to a separate trust for each child, and each trust gets its own exclusion. A founder with three children and a sufficiently large pre-IPO position can stack the QSBS exclusion four ways (founder plus three trusts), turning a $10M federal exclusion into $40M, with no change to who ultimately benefits.
The stacking has to happen before the gain is realized, which is the entire reason this move belongs in the 30-day window after a priced round. The shares are still cheap to move, the QSBS clock is already running (started at original issuance), and the trusts can be funded against the lower pre-round valuation. By the time the company exits in three to seven years, the stacked exclusions are worth tens of millions in saved federal tax.
QSBS exclusion is federal. Some states (like California) do not conform, meaning state tax still applies to the gain. Pairing QSBS gifting with a Nevada or South Dakota trust situs can shelter the gain at the state level too, although the timing and trust mechanics for state-tax planning are stricter than the federal rules. The right time to set up a trust in a no-tax state is years before the exit, not during the wire transfer.
If you are married and live in a community property state (California, Texas, Washington, Arizona, Nevada, New Mexico, Idaho, Louisiana, Wisconsin), the founder shares you acquired during the marriage are typically community property unless you signed a prenup or postnup that says otherwise. That has two large implications for estate planning after fundraising.
First, your spouse already owns half of the shares for property purposes, even if your name is the only one on the cap table. Both spouses can use their own gift tax exemption when funding trusts, effectively doubling the amount of value you can move out of the combined estate. Married founders have $27.98M of combined exemption in 2026, and a properly structured plan uses both halves.
Second, at the death of the first spouse, community property gets a full step-up in basis on both halves, not just the deceased spouse's half. This is a meaningful advantage over common-law states (where only the deceased spouse's share gets the step-up) and changes the math on whether to gift now or hold for the basis step-up later. Founders who recently moved from a common-law state to a community-property state can sometimes elect community-property treatment for shares acquired post-move, but the rules are state-specific.
Pull the 83(b) election proof. Confirm the QSBS qualification with your CPA in writing. Identify any shares that may not be QSBS-eligible (secondary purchases, certain conversions). Get the 409A and the cap table in front of your estate attorney.
Pick the trust structure (or combination) that fits your situation. SLAT, dynasty trust, GRAT, IDGT, or a combination. Decide how many trusts you want for QSBS stacking, who the trustees will be, and what state you want the trusts sited in.
Trust attorneys typically need 7 to 10 days to draft, especially during heavy filing seasons. Sign the trust documents. Execute the assignments to move shares into the trusts. Have the company secretary update the cap table. File any required gift tax returns (Form 709) for the calendar year.
Rewrite the will to reference the new trust structures. Update the financial POA and healthcare proxy to reflect any new asset complexity. Update beneficiary designations on every retirement account, life insurance, and transfer-on-death registration. The structural decision between leaving founder equity through a will or a trust matters more after a round than before; our piece on trust vs will covers the practical differences.
Three patterns repeat at every stage. The first is waiting until the next round to do any planning, which means the next 409A spike happens before the trusts are funded and a meaningful chunk of exemption gets wasted. The second is assuming a single trust with all the kids as beneficiaries gives the same QSBS treatment as multiple separate trusts. It does not, and the difference is one of the largest single planning errors in startup land.
The third is forgetting to coordinate the gifting with the company's internal transfer policies. Most cap tables have transfer restrictions that require board approval or right-of-first-refusal waivers for any share movement, including movement to an irrevocable trust the founder controls. Get the legal team and the company secretary aligned before the trust is signed, not after, or you may discover the share assignment cannot be perfected and the entire structure has to be redone. For the document checklist around all of this, our estate planning checklist is the running tally most founders use through closing week.
Estate planning after fundraising is a 30-day project with a 30-year payoff. The shares are never as cheap to gift as they are right now. The QSBS stacking opportunities are never as wide open as they are right now. The 2026 exemption is never as high as it is right now. Done well in this window, the structures put in place compound silently for the entire life of the company, sheltering tens of millions from federal estate tax and concentrated state tax exposure by the time the exit eventually arrives.
This is also the moment to take the privacy of the plan itself seriously. Most platforms store the cap table data, the trust funding paperwork, the beneficiary names, and the dollar amounts in plaintext on their servers, where one breach exposes the company's ownership structure and the founder's family details to anyone who wants them. DocSats was built for the founder use case: every document is encrypted in your browser before it is ever stored, so even DocSats cannot read your share assignments or your beneficiary list. The plan is anchored to the Bitcoin blockchain for tamper-evident proof of existence, and the digital assets clauses cover the founder shares, the SAFEs, the crypto, and the secondary positions that modern founder balance sheets accumulate. The round closed. The plan should match the new reality, privately, before the next 409A prints.
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