At the end of 2019, the IRS issued final regulations giving investors more guidance regarding Qualified Opportunity Funds. Qualified Opportunity Funds are complex investment vehicles that provide tax incentives to investors. Taxpayers investing in a Qualified Opportunity Fund can defer capital gains, adjust basis to reduce the deferred capital gain, and if the 10-year holding period is met, eliminate gain on the new investment. An opportunity zone is an economically distressed community where new investments, under certain conditions, are eligible for preferential tax treatment. This program is a general introduction to a tax planning strategy with which clients will expect tax practitioners to be conversant.
- What is an opportunity zone?
- Gains that qualify for deferral if invested in an opportunity zone
- What is an opportunity zone business?
- How to elect the deferral of gain
- Timing requirements related to opportunity zone investments
- What is an opportunity fund?
- What are the tax advantages of investing in an opportunity zone?
- Where are opportunity zones located?
- How taxpayers self-certify
- What is the 70%/30% rule?
- What the “original use” requirement means
- Economic issues related to investing in opportunity zones
- Outstanding unanswered questions relating to opportunity zones
- Discuss with clients the tax consequences of investing in opportunity zones
Tax practitioners who wish to be prepared to discuss opportunity zone investments with their clients