A Quick Look at The Investment in a Qualified Opportunity Fund Rules
By Anthony Diosdi The Tax Cuts and Jobs Act enacted Sections 1400Z-1 and 1400Z-2 as a temporary provision to the Internal Revenue Code. These code sections were enacted to encourage private sector investment in certain lower-income communities designated as qualified opportunity zones (“QOZs”). An eligible investor, with significant capital gains can invest in a Qualified Opportunity Vehicle (“QOV”) as a way to minimize the tax burden on such gains when certain requirements are met. QOVs are corporations or partnerships (domestic or foreign) established for the purpose of making equity investments in business, real estate, and business assets in a QOZ. There are three potential tax benefits available to eligible investors who invest in QOZs.First, U.S. income tax on capital gains reinvested into a QOV by an eligible investor is deferred…