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OPPORTUNITY ZONE ISSUES

There is a growing number of unanswered questions about Opportunity Zones.  These questions will be posted here and experts are invited to offer solutions.


Issue - Is the rollover of capital gains from the sale of real property into an Opportunity Zone Fund superior to a 1031 rollover?

The measure of benefit to an investor will depend upon the individual tax situation of the investor and the potential for appreciation in the new investment.  A rollover of capital gains into an Opportunity Zone Fund does not require that the investor re-invest both the principal and the gain as is required by a 1031 rollover.  However, if the new investment in property from a 1031 rollover may be rolled over into an estate without recognition and taxation of a capital gain.  

Issue - If the tax on capital gains is deferred until an investor exits an Opportunity Zone Fund, what is the tax rate that applies to the capital gains: the rate at the time of rollover into the Opportunity Zone Fund or the rate at the time of the exit?

Response pending.

Issue - Who can be an Opportunity Zone Fund manager?

Response pending.

Issue - Does reforestation constitute an improvement to Opportunity Zone Property?

Response pending.

Issue - Is an Opportunity Zone investment in a 'farm' an investment in an Opportunity Zone Business and/or an Opportunity Zone Property?

Response pending.

Issue - Is there any limitation on how long an investment in an Opportunity Zone Fund may last and still receive the benefit of a waiver of tax on gains in the investment?

Response pending.

Issue - Is there a way to distribute cash to an investor in an Opportunity Zone Fund during the investment without losing the waiver of taxes on the gains in the investment?

Response pending.

Issue - Are 'sin businesses' barred from receipt of investment from an Opportunity Zone Fund an open ended definition or are they limited to a 'laundry list' stated in the tax bill?

Response pending.

Issue - In recruiting investors to invest in an Opportunity Zone Fund, are there any exemptions from federal or state securities laws?

Response pending.

Issue - If an Opportunity Zone Fund is strucured as a pass through tax entity (partnership or limited liability company) and the Fund earns profits, how are the tax liabilities handled for the individuals or businesses must recognize the profits?

Response pending.

 

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(720) 296-0372

Address:
7148 S. Andes Circle, Centennial, CO 80016


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