Qualified Opportunity Funds must maintain at least a 90% investment in Qualified Opportunity Zone property at each bi-annual testing date to avoid penalties and ensure investors receive the OZ tax incentives. QOFs can meet that threshold by investing in one or more of the following: Qualified Opportunity Zone stock; Qualified Opportunity Zone partnership interest; or Qualified Opportunity Zone business property. When a QOF purchases Opportunity Zone Business Property directly, that is commonly referred to as a "single-tier" structure. Some people select this route for the simplicity of creating and managing compliance for that structure, particularly if they are contemplating a single-asset fund that does not have a long development horizon. Alternately, an investor can employ a two-tier structure by creating a QOF which owns stock or partnership interest in a Qualified Opportunity Zone Business (QOZB). OZ legislation and regulations provide additional flexibility to QOZBs, including a lower requirement (70%) for the proportion of assets that must be invested in Qualified Opportunity Zone Business property, and a 31-month "working capital safe harbor" for creating a new business or planning for a larger OZ property development. The two-tier structure can also be a useful way to bifurcate investments where there is a mix of deferred capital gain equity and other equity not eligible for the OZ benefits.