Our investment plan has been largely disrupted due to COVID-19. We are wondering if there are any measures we can take to avoid potential loss due to the delay in investment.
A Qualified Opportunity Zone Fund has 180 days to invest the funds into a qualified business or real estate project in an opportunity zone based on the date the fund elects to be an opportunity zone fund. The 180-day period has now been extended to the end of the year for any gains that would have otherwise been required to make between April 1, 2020 and Dec. 31, 2020 are extended to Dec. 31, 2020.
I would invest in a QOZB now and put together a bona fide business plan so you can get the working capital safe harbor extensions under the QOZ Coronavirus Notice. Keeping the cash in a QOF will not get you a better compliance outcome. You would, however, need to explore the details with counsel to make sure you are not inadvertently tripping a different compliance violation.
There are various deadlines. Generally, you need a written plan within six months that has a reasonable possibility of completion within 30 months.
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