IRC 1400Z Qualified Opportunity Zones for Individual Investors: Tax Deferral and Reduction Opportunities

The new opportunity zone provisions found in Section 1400Z-2 of the Internal Revenue Code represent perhaps the most significant economic development tax incentive program in several decades. Code Section 1400Z-2 allows taxpayers to defer, reduce, and in some cases eliminate the tax on capital gains by enabling taxpayers to reinvest capital gain proceeds in a QOF. These funds are established to inject investment capital into designated low-income communities to promote economic growth.

Additional proposed regulations provided answers and clarifications for several open issues. Included in the April 2019 regulations are safe harbor tests for meeting the 50% test for gross income derived within a QOZ and provisions allowing leased property to qualify as QOZ business property.

Listen as our panel discusses the benefits of the new QOZ tax incentive program as an investment tool for taxpayers, the necessary legal requirements and processes to obtain tax credits, and techniques to ensure deferral or reduction of capital gains.

1. Opportunity zone overview
2. Policy and current political considerations
3. Qualified opportunity fund structures
4. Opportunity zone investment requirements and mechanics
5. Real-world examples and issues
6. Incentive comparison-- “Q-ville”
7. Filing and documentation requirements

The panel will review these and other key issues:

• What are QOZs and the eligibility requirements under Code Section 1400Z-1?
• What are QOFs and QOZ businesses?
• How taxpayers can form and operate their own QOF and/or QOZ business.
• How taxpayers can ensure deferral, reduction and/or elimination of capital gains tax liability.
• Recent IRS guidance on gain deferral and the how to satisfy the various "substantially all" asset and operational requirements.

Learning Objectives

After completing this course, you will be able to:

• Determine what a QOZ is and the eligibility requirements under IRC 1400Z
• Identify QOFs and QOZ businesses
• Decide how taxpayers can ensure the deferral or reduction of capital gains and the appreciation exclusion

• Recognize the impact of recent IRs guidance on gain deferral and the "substantially all" requirement imposed on QOZ businesses

• Identify the uncertainties regarding 1400Z until the IRS provides additional guidance

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules, supervising other preparers/accountants. Working knowledge and understanding of tax credits, sourcing rules; foundational knowledge of basis calculations and capital gains tax

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).