How do the regulations determine if Working Capital Assets are considered to be reasonable working capital?
This is usually done by reference to the QOZB's business plan. The business plan must describe the planned nature and timing of the use of the working capital. If the assets fit the business plan and meet the regulatory requirements. They are cash equivalents or short-term debt instruments. Then they will be considered reasonable working capital reserves.
A very detailed plan for the use of the funds and schedule must be prepared and followed. Strict compliance is required.
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.