INSIGHT: The Second Set of Proposed Opportunity Zone Regulations: Where Are We Now?

On April 17, 2019, the Treasury Department issued a highly anticipated second set of proposed regulations on opportunity zones (the “2019 proposed regulations”). The opportunity zone (OZ) program has received significant national attention as an ambitious and generous tax incentive aimed at driving investment into the nation’s most distressed communities.

This part of the series addresses how the regulations explain the requirements for a qualified opportunity fund (QOF), qualified business property, and qualified businesses.

The QOF:

What additional information will a QOF be required to report?

The Preamble to the 2019 proposed regulations provides that the Form 8996 will be amended for the 2019 tax year and following years. There will be additional information required on that form, likely including the EINs of qualified opportunity zone businesses that the QOF invests in and the amount of each such investment. There may be additional information requested on that form as well.

Moreover, there has been a widespread call for increased reporting requirements so that data can be collected and disseminated regarding the impact of opportunity zone investments. Treasury and the IRS have requested comments on methodologies that could be utilized to collect and assess relevant data on opportunity zone investment and its impacts and outcomes relative to economic indicators (e.g., how many jobs were created, what are the increases, if any, in poverty levels, etc…).

How does a QOF value its assets for purposes of the 90/10 test?

The 2018 proposed regulations (and the instructions to Form 8996) provided that if a QOF filed a financial statement with the SEC or another federal agency other than the IRS or if the QOF has an audited financial statement prepared in accordance with U.S. GAAP, the QOF would use the asset values as reported on its financial statement as the relevant value for the 90 percent test. If the QOF did not have a financial statement that meets these requirements, value would be based on the QOF’s cost.

The 2019 proposed regulations change this and instead provide that a QOF generally has a choice of valuation method. For each tax year, it can value its assets using the applicable financial statement valuation method (if it has an applicable financial statement within the meaning of Treasury Regulation Section 1.475(a)-4(h)) or the alternative valuation method. A QOF can change methods year to year but must apply a single method consistently during each taxable year to all of its assets.

Comment: This is a welcome change from the valuation guidance in the 2018 regulations. The 2019 proposed regulations allow a QOF flexibility to choose its valuation method on a year-to-year basis.

Applicable Financial Statement Valuation Method:

Under the applicable financial statement valuation method, the QOF will value its assets based on the value of each asset that it owns or leases as reported on the applicable financial statement for the relevant reporting period (if it has an applicable financial statement within the meaning of Treas. Reg. Section 1.475(a)-4(h)). However, if the QOF is leasing assets, this method is only available if the applicable financial statement is prepared according to U.S. GAAP and assigns a value to the lease of the asset.

Alternative Valuation Method:

Under the alternative valuation method, the value of each asset owned by the QOF is the QOF’s unadjusted cost basis of the asset under tax code Section 1012. The value of each asset leased by the QOF is the sum of the present values of each payment under the lease for the asset, as determined at the time the QOF enters into the lease. For purposes of making this calculation, the term of a lease includes periods during which the lessee is able to extend the lease at a pre-defined rent. Once the QOF calculates the value of a leased asset, that value remains the same for all testing dates. The applicable discount rate is the applicable federal rate under tax code Section 1274(d)(1).

Assets Excepted From Application of the 90/10 Test:

A QOF also has the option (under either the applicable financial statement method or the alternative valuation method) to do the 90/10 calculation excluding certain property from both the numerator and denominator if the following three requirements are met:

the property was received by a QOF partnership as a contribution or by a QOF corporation solely in exchange for stock of the corporation;

the contribution or exchange occurred not more than 6 months before the relevant testing date; and

between the time the QOF received the property and the testing date, the amount was held in cash, cash equivalents or debt instruments with a term of 18 months or less.

A QOF is able to make a decision with respect to excluding property that meets these requirements for each testing date—it does not need to be consistent from one date to the next.

Comment: This new rule gives QOFs flexibility with respect to cash acquired within a short time (six months) of its next testing date to allow the QOF a period of time to decide how to deploy that money.

Comment: Note that this is the only “grace period” afforded a QOF with respect to the 90/10 test. Many commentators suggested a start-up grace period of at least 18 months from the time a QOF is formed before its first testing period would begin. Other than this limited exception for cash received during the 6 months prior to a testing date, there is no other grace period in either set of proposed regulations. In fact, the 2019 proposed regulations specifically provide that except as provided in Treas. Reg. Section 1.1400Z(2)(d)-1(a)(2)(ii) (which allows a QOF to ignore (for purposes of the 90/10 test) any months before the first month in which it certifies as a QOF), if a QOF fails to satisfy the 90/10 test, the QOF must pay the penalty for each month that it fails the test. If a QOF invests its cash in operating subsidiaries by its testing dates, this issue is alleviated as long as the subsidiary meets the working capital safe harbor.

How long does a QOF have to re-invest capital upon the sale of qualified opportunity zone property (QOZP)?

Tax code Section 1400Z-2(e)(4)(B) specifically authorizes regulations to make sure that a QOF has a “reasonable period” in which to re-invest the return of capital from investments in qualified subsidiaries and/or the proceeds from a sale or other disposition of QOZP. The 2019 proposed regulations provide that a QOF has 12 months within which to reinvest proceeds from a return of capital or the sale or other disposition of qualified opportunity zone property. If and to the extent that the QOF reinvests the proceeds in QOZP within 12 months, the proceeds are treated as QOZP for purposes of the 90/10 test.

What are the tax consequences with respect to interim sales of QOF assets? Does the reinvestment of proceeds by the QOF within 12 months mean that the investors (if the QOF is a pass-through) or the QOF (if QOF is a corporation) do not recognize any gain on the sale?

This is a significant issue because there will be many circumstances in which it is in a QOF’s economic interest to sell assets. The statute clearly contemplated re-investment of capital proceeds from such sales but is silent as to whether the re-investment is treated as continuous investment such that no gain is recognized. It was clear from the comments in the Preamble to the 2018 proposed regulations that Treasury and the IRS understood the need for clarification but they needed to provide this clarity in the context of a “statutorily permissible possibility.”

Unfortunately, they have come to the conclusion that they do not have the authority to provide for the nonrecognition of gain on a sale of an asset by a fund. In the context of a QOF partnership, if the sale occurs after an investor has held its fund interest for at least 10 years, the investor is able to elect to exclude the gain allocated to that investor. However, in all other cases, a sale is a taxable event and there is no applicable nonrecognition provision.

Comment: This could be a significant issue for certain types of funds, including venture capital investment in start-ups. The economics of venture investing generally requires sales of businesses prior to the 10-year mark. Congress needs to consider a legislative fix for this issue in order to avoid creating a disincentive for certain types of investments.

Qualified Opportunity Zone Business Property (QOZBP)

What is a “trade or business” for purposes of determining whether a QOF uses property in a trade or business?

An activity is a trade or business if it would be considered a trade or business under tax code Section 162.

When does “original use” commence with respect to tangible property acquired by purchase?

The regulations tie the date that original use commences with the placed in service date for purposes of depreciation or amortization. They provide that the original use of tangible property acquired by purchase commences on the date any person first places the property in service in the QOZ for purposes of depreciation or amortization (or first uses it in a manner that would allow depreciation or amortization if that person were the property’s owner). So, if property has been depreciated or amortized by any other person (or could have been if the user had been the owner of the property), that property is not original use property and must be substantially improved to be qualified opportunity zone business property.

Can used tangible property acquired by purchase ever qualify as “original use” property?

Yes, but only if the property has not previously been used within that QOZ in a manner that would have allowed it to be depreciated or amortized by any taxpayer.

Comment: This rule appears to allow a taxpayer to purchase used tangible property located outside of a QOZ and move it into a QOZ as long as that taxpayer is the first to have used that property in that QOZ in a manner that would allow depreciation or amortization.

If property is vacant for a period of time can it qualify as “original use property”?

Yes. Under the 2019 proposed regulations, if property in a zone has been unused or vacant for an uninterrupted period of at least five years, original use in the zone commences on the date after the period of non-use or vacancy when any person first uses the property in the zone. Several commenters had requested that the necessary vacancy period be one year but Treasury and the IRS were concerned that owners could abuse the provision by intentionally abandoning property in an effort to increase its value as original use property in a QOZ.

Does the substantial improvement test apply to unimproved land?

No. Unimproved land that is in a QOZ and is acquired by purchase pursuant to the rules does not have to be substantially improved. However, land must be used in a trade or business in order to be considered QOZBP. In addition, the 2019 proposed regulations provide that a QOF is not allowed to rely on the “no substantial improvement” regulation if the land is unimproved or minimally improved and the QOF or qualified opportunity zone business (QOZB) purchased the land with an expectation, an intention, or a view not to improve the land more than an insubstantial amount within 30 months of the date of purchase. This provision is an exception to the general rule allowing a taxpayer to rely on these proposed regulations.

Comment: The Preamble acknowledges that there is potential for abuse here but in addition to the language that requires more than minimal improvement in order to rely on the proposed regulatory rules, there is also a general anti-abuse rule in the regulations that could be used in circumstances in which there is not sufficient new investment being made (which would essentially amount to “land-banking”). The Preamble to the 2019 proposed includes an example of a taxpayer purchasing land that was used to grow a crop (whether active or fallow) and states that the purpose of the OZ rules would not be realized if the taxpayer does not increase any economic activity or output of, the parcel. This does not mean that farming is not a qualifying QOZB business; it simply means that if a QOF or QOZB purchases unimproved land and does little to nothing with it in terms of increasing its economic uses then there has not been sufficient new investment in the property to comply with the intent of the OZ program. If a significant purpose for acquiring the unimproved land was to achieve this inappropriate tax result then the general anti-abuse rule would apply.

Does a taxpayer have to satisfy the substantial improvement test on an asset-by-asset basis or can it be satisfied on an aggregate basis?

As of now, the test is applied on an asset-by-asset basis, although Treasury and the IRS have acknowledged that an aggregate approach (allowing tangible property to be grouped by location or type in the same, or contiguous, qualified opportunity zones) would incentivize investment.

Comment: There are several circumstances in which an aggregate approach would be far preferable and may even be necessary for a transaction to be economically viable. One example is the purchase or expansion of an existing business in a QOZ. If, in applying the 70/30 test to the tangible property, each asset has to either be original use property or be substantially improved, qualifying as a QOZB could be very difficult. Aggregation rules could make this type of transaction far more attractive to investors.

Are there any special rules applicable to inventory?

The 2019 proposed regulations provide a safe harbor for inventory in transit. Pursuant to this safe harbor, inventory that is in transit either (1) from a vendor to a facility of the trade or business that is in a QOZ, or (2) from a facility of the trade or business that is in a QOZ to customers of the trade or business that are located outside a QOZ is considered as being used in a QOZ.

Can property leased directly by a QOF be QOZBP?

Yes. The 2019 proposed regulations clearly state that a QOF is able to lease property and have it qualify as QOZBP if the requirements are met.

What requirements must be met in order for leased property to be considered QOZBP (by either a QOF or a QOZB)?

With respect to all leased property, the property will be QOZBP if (1) it is acquired under a lease entered into after Dec. 31, 2017, (2) the terms of the lease are market-rate (as determined under tax code Section 482) at the time it is entered into, and (3) during substantially all of the QOF’s holding period for the property, substantially all of the use of the property was in a QOZ.

Those two requirements are applicable to all leases. In addition, there is a general anti-abuse provision applicable to leases. That rule provides that if there is a lease of real property (other than unimproved land) and, at the time the lease is entered into, there is a plan, intent or expectation that the QOF will purchase the real property for an amount other than the fair market value of the property as determined at the time of purchase without regard to prior lease payments, the leased real property is not QOZBP at any time.

There is no general “original use” or “substantial improvement” test applicable to leased property.

In addition, there is no prohibition on related party leases. However, there are additional rules applicable to a related party lease. First, the lessee cannot, at any time, make a prepayment of rent relating to a period of use that exceeds 12 months. Second, if the original use of leased tangible personal property does not commence with the lessee, the lessee must become the owner of an equal amount (in value, as determined under the valuation method chosen by the QOF) of tangible property that is QOZBP within the relevant testing period and there must be substantial overlap in the zones in which the lessee uses the leased tangible personal property and the acquired tangible property. The “relevant testing period” begins on the date that the lessee receives possession of the leased tangible personal property and ends on a date that is the earlier of (1) the date 30 months after the date the lessee received possession of the leased tangible personal property, or (2) the last day of the term of the lease (which will include periods during which the lessee may extend the lease at a pre-defined rent).

Do lessee improvements to leased property qualify as “original use” property?

Yes. Improvements that a lessee makes to leased property satisfy the original use requirement as purchased property equal to the unadjusted cost basis of the improvements.

Qualified Opportunity Zone Businesses (QOZBs)

A QOZB is a trade or business that meets all of the following requirements:

(1) substantially all (70 percent under the 2018 proposed regulations) of the tangible property owned or leased by the QOZB is QOZBP;

(2) at least 50 percent of the QOZB’s total gross income is derived from the active conduct of a trade or business in the zone;

(3) a substantial portion of the QOZB’s intangible property is used in the active conduct of the business;

(4) less than 5 percent of the average of the aggregate unadjusted bases of property is attributable to nonqualified financial property (“NQFP,” which does not include reasonable amounts of working capital held in cash, cash equivalents, or debt instruments with a term of 18 months or less); and

(5) the business does not include operation of a private or commercial golf course, country club, massage parlor, hot tub facility, suntan facility, racetrack, gambling establishment or a store if the principal business is the sale of alcohol for consumption off premises.

For purposes of applying the 70/30 test applicable to a QOZB’s owned or leased tangible property, how is the property valued?

Substantially all (70 percent) of the property owned or leased by a QOZB must be QOZBP. In determining whether this test is met, a QOZB will value its tangible property by following the same rules that apply to a QOF in valuing its assets under the 90/10 test. The QOZB generally has a choice from year-to-year to either use the financial statement valuation method (if it has an applicable financial statement within the meaning of Treas. Reg. Section 1.475(a)-1(h)) or the alternative valuation method. These methods are discussed more fully, above.

For purposes of applying the 50 percent of gross income test listed above, how is a QOZB’s income sourced? In other words, when is it considered “derived” from the active conduct of a trade or business “in the zone?”

One of the most critical outstanding issues with respect to the OZ program was how and to what extent the program could work in the context of investment in operating businesses. The lack of regulatory guidance on income sourcing was one of the main sources of uncertainty. The 2019 proposed regulations provide broad, flexible income sourcing rules that will allow many different types of businesses in various industries to qualify; there are three separate safe harbors that a business can rely on and if none of those apply, a general facts and circumstances test can be applied.

The first two safe harbors focus on the services performed for a trade or business by employees, independent contractors (and employees of independent contractors). Under the first safe harbor, if at least 50 percent of all of those services, based on hours, are performed in a QOZ, the test is met. The determination is made based on a ratio where the numerator is the total hours of services performed in a QOZ during the taxable year and the denominator is the total hours of services performed in a taxable year. Under the second safe harbor, if at least 50 percent of all of those services, based on the total amount paid by the entity for the services, are performed in a QOZ, the test is met. The determination is made based on a ratio where the numerator is the total amount paid by the entity for services performed in a QOZ during the taxable year and the denominator is the total amount paid by the entity for services performed during the taxable year.

Example: The Preamble to the 2019 proposed regulations provides the following examples of the first two safe harbors: A tech start-up that develops software for global sale through internet downloads has its campus in a QOZ. The majority of the total hours spent on the business are spent by employees and independent contractors doing the development work from within a QOZ. The business meets the first safe harbor. If the business also uses a service center, located outside of a QOZ, the business is still able to qualify even if the majority of the services performed for the business, from an hours perspective, occur at the service center. As long as the total amount that the business pays for services performed within the QOZ (the software development services) is at least 50 percent of the total amount it pays for services overall, the business meets the second safe harbor.

Comment: The second safe harbor allows a trade or business to locate one or more facilities outside of a QOZ and meet the 50 percent of gross income test as long as its highest paid employees are working from within a QOZ. As long as the business is paying at least 50 percent of the total amount it pays for services to the employees/independent contractors located in the QOZ, the 50 percent of gross income test can be satisfied.

Comment: The first safe harbor should allow a business to have different locations from which it operates its business (e.g., a business that owns three restaurant locations) as long as the activity is considered one trade or business and the majority of hours spent by all employees and independent contractors occur in a QOZ. Depending on the business and the size of the activities outside a QOZ, this may mean that the majority of locations need to be within QOZs.

Under the third safe harbor, if tangible property located in a QOZ as well as management or operational functions performed in a QOZ are each necessary for the generation of at least 50 percent of the gross income of the trade or business, the test is met.

Example: The regulations provide the following example of the third safe harbor: A landscaping business has both its headquarters and its management function in a QOZ. The employees and managers that are located in the QOZ manage the activities of the business, whether they take place within or outside of a QOZ. The equipment and supplies are stored in the headquarters facility. This business would meet the third safe harbor because there is tangible property located in a QOZ (equipment and supplies) and management occurring from within a QOZ, both of which are necessary (the example in the regulations uses the phrase “material factors”) in the generation of the income of the business.

Comment: Note here that this example does not even mention where customers are located and whether or not at least 50 percent of them reside in QOZs. Those facts are not relevant under this safe harbor. In fact, customer location is not generally relevant at all under the three safe harbors, with the exception of the first safe harbor in the context of a services business where employees and/or independent contractors are performing services for customers within and outside of QOZs and the hours spent performing those services will be compared.

The regulations provide an example of a business with a post office box located in a QOZ which states that the receipt of mail at that post office box is “fundamental” to the business but indicates that there is no other basis for concluding that the income of the trade or business is derived in the QOZ. Thus, it is insufficient in and of itself to qualify the business under the OZ rules. The mere location of the post office box is not a material factor in the generation of gross income.

If none of these safe harbors is met, the business can apply a facts and circumstances test to determine whether the 50 percent of gross income test is met.

To the extent that the tests applicable to a QOZB require an analysis of whether a QOZ is the location of services, tangible property, or business functions, how are businesses that straddle QOZs treated?

If a business uses real property located in a QOZ and also uses real property that is located outside of a QOZ (the business holds property straddling multiple Census tracts, not all of which are designated as QOZs), the rule in tax code Section 1397C(f) applies such that all of the real property is deemed to be located within a QOZ for purposes of applying the QOZB tests if:

the amount of real property (based on square footage) that is located in a QOZ is substantial as compared to the amount outside of the QOZ; and

the real property located outside the QOZ is contiguous to part or all of the real property located inside the QOZ.

The Preamble provides that real property located within the QOZ should be considered substantial if the unadjusted cost of the real property inside a QOZ is greater than the unadjusted cost of real property located outside of the QOZ.

For purposes of the requirement that a QOZB use a substantial portion of its intangible property in the active conduct of the business, what does “substantial portion” mean?

The 2019 proposed regulations provide that for purposes of this test, a “substantial portion” is 40 percent.

Does the leasing of residential rental property qualify as an active trade or business for purposes of the definition of a QOZB?

Yes. The 2019 proposed regulations clarify that the ownership and operation of real property, including leasing, is considered the active conduct of a trade or business for purposes of applying tax code Section 1400Z-2(d)(3)(A)(definition of a QOZB).

However, merely entering into a triple-net-lease with respect to real property is not considered the active conduct of a trade or business. A taxpayer will need to conduct some other activity with respect to the leased property in order for there to be an active trade or business under the OZ rules.

How is the reasonable working capital exception from the definition of non-qualified financial property (NQFP) applied in the context of an operating business?

The 31-month working capital safe harbor provided in the 2018 proposed regulations was limited in its application and was relevant only to property development—specifically the acquisition, construction and/or rehabilitation of tangible business property in a QOZ. The regulations did not provide a safe harbor or any other guidance on how the concept of reasonable working capital would be applied in the context of other types of business activities. The 2019 proposed regulations amended the guidance on the working capital safe harbor and provide that the safe harbor applies if amounts are designated in writing for the development of a trade or business in a QOZ, including when appropriate, the acquisition, construction and/or substantial improvement of tangible property in the zone.

Example: The regulations provide an example of the use of the working capital safe harbor in the context of an operating business. In the example, the business entity (QOZB that has received cash from a QOF) is opening a fast-food restaurant in a QOZ and has a 20-month schedule to deploy cash. The written schedule outlines the planned uses for the cash. The business holds the cash it has not yet deployed in assets described in tax code Section 1397C(e)(1)(cash, cash equivalents and debt instruments with a term of 18 months or less) and uses the cash in a manner consistent with the plan and schedule. The business is complying with the working capital safe harbor.

Comment: If capital is being deployed to develop an operating business in a QOZ, there must be a written plan; clients should document the anticipated uses of working capital and should have commercially reasonable business plans that support the use of specified amounts of working capital.

The two examples in the 2019 proposed regulations on the working capital safe harbor provide a number of examples of the types of expenditures that an operating business could list in its written plan, including:

identifying favorable locations for the business in the QOZ;

leasing suitable space;

outfitting the space with equipment and furniture;

making necessary security deposits;

obtaining a franchise;

obtaining local permits;

hiring, training and paying salaries to employees and independent contractors;

performing R&D; and

paying development costs.

This list is not exhaustive but is illustrative of the types of expenses an operating business may incur and how specific the written plan should be with respect to the use of working capital pursuant to the written plan.

Are there circumstances in which the 31-month working capital safe harbor will be extended and, if so, what are those circumstances?

The 2019 proposed regulations provide that if there is a delay caused by waiting for governmental action and the application for that action is complete, the delay does not cause a failure to comply with the working capital safe harbor.

Comment: As of now, this is the only regulatory extension provision. There are certainly other circumstances in which 31 months may not be sufficient. There are often unforeseen events outside of a QOZB’s control that delay completion. Perhaps in these instances the reasonable cause exception from the penalty for a QOF’s failure to comply with the 90/10 test would apply.

For purposes of the working capital safe harbor, does each contribution of cash to a QOF begin its own 31-month period? Is a business able to apply the working capital safe harbor more than once and/or overlap 31-month periods?

It is quite common in both real estate and business development to capitalize a project in stages with contributions made over time. If a QOF contributes cash to a QOZB over time, does the QOZB have 31 months from each contribution date to use the contributed cash pursuant to a written plan? Yes. The 2019 proposed regulations provide that a single business is able to benefit from multiple overlapping or sequential applications of the safe harbor as long as each time it is applying the safe harbor, the application independently meets all of the applicable requirements.

Example: On Date 1, a business entity (QOZB) receives cash from a QOF to start a new business and the QOZB writes a plan for use of the Date 1 cash in the development of the business over a period of time not exceeding 31 months from the date of the contribution. Two years later, on Date 2, the QOZB receives additional cash from the QOF to use in the business and writes a plan for use of the Date 2 cash in the further development of the business over a period of time not exceeding 31 months from the date of the contribution. The QOZB holds the cash from both contributions that it has not yet deployed in assets described in tax code Section 1397C(e)(1) (cash, cash equivalents and debt instruments with a term of 18 months or less) and uses the cash in a manner consistent with the two plans and schedules. The business is complying with the working capital safe harbor.

What is the meaning of the phrase “substantially all” as used in various places in the statute?

The 2018 proposed regulations answered this question with respect to use of the phrase “substantially all” in the context of the QOZB tangible property test (70 percent). The 2019 proposed regulations provide that “substantially all” generally means 70 percent but means 90 percent when applied to holding periods.

CONCLUSION:

In my article on the 2018 proposed regulations I stated that the approach in that set of regulations evidenced a desire on the part of Treasury and the IRS to facilitate opportunity zone transactions. In spite of the fact that some issues remain, the second set of regulations continues to evidence this same intent. This second set of proposed regulations provide guidance on key aspects of the OZ program and give taxpayers additional options for investment that will satisfy the requirements.

It remains to be seen how Treasury will respond to comments on the 2018 proposed regulations and whether and to what extent the tax community’s comments on this newest set of proposed regulations will result in change to this guidance. There is, however, a way forward. Taxpayers and their tax advisors are able to rely on both sets of proposed regulations and, in most instances, there is now enough there to structure both real estate development projects and investment in operating businesses with confidence that the transactions meet the OZ requirements.

I end this article the same way I ended the October 2018 article because this statement remains true (especially in light of the new general anti-abuse rule):

If a taxpayer takes a reasoned approach in a legitimate market-driven transaction that is not abusive and structures and operates a QOF investment in a manner that furthers the policy behind the program (facilitating economic growth and development in an opportunity zone), there should be little risk that the transaction will fail to qualify for the tax incentives based solely on a difference in the interpretation of a term or definitional test in the statute.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

Lisa is the Co-Chair of Buchanan, Ingersoll & Rooney’s Tax Section and the Co-Chair of its Opportunity Zones Practice Group. Her tax practice focuses on business tax planning with particular emphasis on pass-through taxation and real estate transactions.

The author wishes to thank Bruce Booken, co-chair of the Tax Section at Buchanan, Ingersoll & Rooney, for his review and insightful comments with respect to this article.

For a copy of the entire article as it appears in the Tax Management Memorandum, click here:

INSIGHT: The Second Set of Proposed Opportunity Zone Regulations: Where Are We Now?—Part 3