Illustrative Opportunity Zone Program Tax Deferral Timeline


Asset Sale

Investor has $10.0MM capital gain
March 2019

Year Zero

Investor invests $10.0MM into QOF within 180 days of capital gain realization
Tax deferral begins and basis in QOF is set at zero
March 2024

Year Five

Basis in QOF increased by 10.0% to $1.0MM
March 2026

Year Seven

Basis in QOF increased by an additional 5.0%, a total of 15.0% to $1.5MM

December 31, 2026

Tax deferral Period Ends
Mandatory tax payment
Basis in QOF increased by an additional 85% to $10.0MM
March 2029

Year Ten

If investor sells interest in QOf after ten years, investor’s basis in the investment is deemed to be the fair market value
The effect would be no tax on the appreciation of the investment