QOZ update – IRS issues additional proposed regulations

Description

Abstract: The IRS has released a second set of proposed regulations on the new tax incentives for investments in Qualified Opportunity Zones (QOZs). The incentives, created by the Tax Cuts and Jobs Act, permit taxpayers to defer, reduce and even permanently exclude capital gains on their investments. This article highlights the proposed regulations — most of which real estate investors can rely on until final regulations are published — including several provisions that are favorable for real estate investors. A short sidebar covers several transactions that can result in the loss of the QOZ tax deferral.