I purchased property about 4 1/2 years ago. I recently found out this land is in an opportunity zone. I just received approval to construct a building on the land and would like to self-certify as a QOF. I read that you must make substantial improvements to the property within 30 months of purchasing the land to qualify for a QOF. If that's the case, do I need to re-sell or transfer that land to a new entity and then file the new entity as a QOF? Not sure why they wouldn't allow me to certify as a QOF now, and make improvements with 30 months of filing as a QOF.
This is a classic ground lease scenario. Perhaps the land itself needs to be excluded from the benefits, but the structure can qualify. What you'd do is lease the property in question to a QOZB and have the QOZB construct the improvements. If you play your compliance cards right, the QOZB is eligible for the OZ incentives, though the master landlord entity won't be.
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