How It Works
When you have a capital gain from selling stocks, real estate, or a business, you can defer that gain by investing in a Qualified Opportunity Fund (QOF) within 180 days. If you hold the QOF investment for 10+ years, any appreciation in the QOF investment is completely tax-free.
Who Qualifies
- Anyone with recent capital gains
- Gains must be invested within 180 days
- Long-term investment horizon (10+ years ideal)
- Comfort with real estate or business investments
Key Requirements
- Investment must be in Qualified Opportunity Fund
- 180-day investment window from gain recognition
- Annual reporting on Form 8997
- 10-year hold for maximum benefit
Documentation Needed
Documentation of original gain, QOF investment records, Form 8997, fund operating agreement.