The federal Opportunity Zone (OZ) Program was enacted as part of the 2017 Tax Act. Two sets of lengthy Proposed Regulations were issued in 2018 and early 2019. On December 18th Treasury and the IRS issued 544 pages of Final Regulations, including an extensive preamble.
Consistent with the Proposed Regulations, Treasury attempted to interpret the OZ statute in the most taxpayer friendly
ways. The Final Regulations (“Regulations”) are being well-received by OZ investors, OZ Fund managers and OZ consultants. We anticipate that OZ fund investing will see renewed momentum as a result of the clarity in these regulations, as well as the December 31st deadline for maximizing the OZ benefits.
The Regulations will generally become effective 60 days from December 18th, but taxpayers can elect to adopt
A discussion of the most significant provisions are summarized below: