The second round of proposed regulations under Section 1400Z-2 of the Internal Revenue Code are now under review at the Office of Information and Regulatory Affairs (“OIRA”).

The OIRA website stated that this round of regulations will address:

• Which types of property qualify as qualified opportunity zone business property; and steps a qualified opportunity zone business must take to be qualified.  
• Guidance on the penalty imposed for failure to meet the investment standard required by Section 1400Z-2(d).
• How qualified opportunity funds will invest deferred gains into qualified opportunity zone property and qualified opportunity zone businesses.

OIRA has a mandated 10-day minimum review period, although the first set of proposed regulations were in review for over a month. According to a treasury official, there likely will be a third set of proposed regulations issued to address anti-abuse and the decertification process.

What Does CohnReznick Think?

Contact

For more information on Opportunity Zones, please contact:

Steve Friedman, CRE, FRICS, Tax Director, (301) 280-1849

David Kessler, Chief Executive Officer, (301) 657-7755

Beth Mullen, CPA, Partner - Affordable Housing Industry Leader, (916) 930-5750

Brian Newman, CPA, Partner, Practice Leader - Federal Tax Services, (959) 200-7009

Thomas Nice, CPA, Partner, (301) 961-5542

Ira Weinstein, Managing Principal - Baltimore, (410) 783-8328 

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