Considering an Opportunity Zone Investment? Here's How to Tell the IRS, July 25, 2019

Now that the IRS has released a significant amount of guidance on the opportunity zone rules, qualified opportunity zone funds are likely to become more common, leading taxpayers to question how to actually defer taxation on their capital gains through the opportunity zone rules. Taxpayers who have made a sale where the proceeds qualify for capital gain treatment may invest all or a part of that gain in a qualified opportunity fund and defer recognizing the gain under the new opportunity zone rules. The taxpayer makes the election on his or her tax return by attaching a completed Form 8949 to the return. For multiple investments occurring on different dates, the taxpayer uses multiple rows of the form to report the deferral election. If the taxpayer has already filed the relevant tax return, he or she will need to file an amended return to make the election. For more information on the opportunity zone rules, visit Tax Facts Online.