Ask A Question

How can an OZ investor contribute other property, in addition to cash, in exchange for an eligible interest in a QOF?

How can an OZ investor contribute other property, in addition to cash, in exchange for an eligible interest in a QOF?


Answers
  • Maria De Los Angeles Rivera
    August 20, 2020

    An investor may contribute property, but in general, the property will not be considered QOZP and therefore may affect the fund's 90% test.

  • Matthew Rappaport
    July 25, 2020

    It's OK to do so, but the property itself cannot qualify as QOZBP, and if there's any built-in gain, the property portion of the contribution is treated as a mixed investment. I generally do not recommend that clients do this unless there is no other choice.

  • Brad Cohen
    July 25, 2020

    Do it, but you only get credit for the basis. Balance is considered a non-qualifying investment.

  • David LeGrand
    July 24, 2020

    Only rollover capital gains qualify for the OP Zone tax incentives.

  • DISCLAIMER: 

    the information found on this website is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your particular situation. You should seek consultation with legal and financial experts prior to participating in any aspect relating to Opportunity Zones. Posting a question on this website does not create an attorney-client relationship. All questions you post will be available to the public; do not include confidential information in your question.