Thank you to Partner and Vice Chair of Lowenstein Sandler LLC’s Tax Group, Lesley Adamo, who hosted Band Members with her insights into “Startup Financing: The Tax Treatment of Convertible Notes and SAFEs”. Tax characterization of such instruments is not always clear, and the use of these instruments could have a negative tax result for investors in the absence of efficient tax planning. We discussed the typical terms of SAFEs and convertible debt, key tax considerations, strategies to mitigate negative tax outcomes, and the relevance of Sections 1202, 1045, and other tax provisions.