FundTaxes

Opportunity Zone guides

Plain-English explanations of the QOF rules, written from the statute and Treasury guidance, each with a calculator you can use on your own numbers.

How a Qualified Opportunity Fund worksA capital gain is invested in a Qualified Opportunity Fund within 180 days; the fund holds at least 90% of its assets in Opportunity Zone businesses and property. $ Capital gain within 180 days QOF Qualified Opportunity Fund ≥ 90% in zone property Opportunity Zone businesses and property

What is a qualified opportunity fund? QOF rules, benefits and the 180-day clock

A qualified opportunity fund (QOF) lets you defer and cut tax on capital gains in Opportunity Zones. Rules, deadlines and a free 180-day calculator.

Oct 10, 2026 · 9 min read
Structure of a self-formed opportunity fundFour layers: investors put capital gains into their own QOF, an LLC taxed as a partnership; the QOF owns a QOZB operating company; the QOZB owns the building or business in the zone.You and your partnersinvest capital gains within 180 daysYour QOF (LLC taxed as a partnership)self-certifies on Form 8996, 90% testYour QOZB (operating LLC)70% tangible property, 50% income, cash planThe building or business in the zoneoriginal use or substantial improvement

Can you start your own opportunity zone fund? Single-asset QOFs, LLCs and the traps

Yes, you can form your own QOF for one property. Which LLCs qualify, related-party and personal-use traps, SDIRAs, and the steps from formation to Form 8996.

Oct 10, 2026 · 9 min read
Opportunity Zones 2.0 map changeIllustration of census tracts: the 2018 Opportunity Zones fade out and a smaller set of OZ 2.0 tracts, designated for January 1, 2027 through 2036, fills in. 2018 zones (end 2028) OZ 2.0 zones from January 1, 2027 Illustration. Eligibility: median family income at or below 70% of area median, no contiguous tracts.

Opportunity Zones 2.0: every change from the One Big Beautiful Bill Act, and the 2027 map

OZ 2.0 explained: permanent zones, a new 2027–2036 map, 5-year rolling deferral, 10%/30% rural step-ups and new reporting penalties. Which rules apply to you?

Oct 10, 2026 · 10 min read
1031 exchange versus Opportunity Zone fundA $1,000,000 sale with a $400,000 gain: a 1031 exchange reinvests the full $1,000,000; a QOF investment needs only the $400,000 gain, and the $600,000 basis comes back to the seller.Sale price $1,000,000basis $600,000 · gain $400,000 1031 exchangereinvest all $1,000,000 in like-kind real estate Opportunity Zone fundinvest only the $400,000 gain $600,000back to you

Opportunity zone fund vs. 1031 exchange: which fits your sale?

Can you 1031 into an opportunity zone? No, but you can use both. Compare what you reinvest, deadlines, recapture and the 10-year exclusion. Free calculator.

Oct 10, 2026 · 8 min read
Opportunity zone tax benefits over ten yearsTwo lines show the after-tax value of one dollar of capital gain over ten years: a QOF investment under OZ 2.0 rules ends above a taxable investment.$0.80$1.00$1.20$1.40$1.60Year 0Year 5Year 10 Year 5: deferred gain taxed (10% step-up) QOF Taxable After-tax value per $1 of gain, 7% annual growth, 23.8% federal rate. Illustration, not a forecast.

Opportunity zone tax benefits: deferral, step-up and tax-free growth, with the math

The three opportunity zone tax benefits under OZ 2.0, with numbers: 5-year deferral, a 10% or 30% step-up and tax-free growth after 10 years. Free calculator.

Oct 10, 2026 · 9 min read
Opportunity zone fund due-diligence checklistA checklist ticks off sponsor track record, disclosed fees, how the fund passes the 90% and QOZB tests, the working-capital plan and the exit plan, and flags guaranteed returns as a red flag.Sponsor track record in the asset typeFees disclosed: acquisition, asset management, promoteHow the fund passes the 90% and QOZB testsWorking-capital plan and construction budgetExit plan after year 10Guaranteed returns or “IRS-approved fund”

How to vet an opportunity zone fund: fees, track record, K-1s and red flags

What to ask before investing in an opportunity zone fund: sponsor record, fees, 90% test compliance, cash for the tax bill, the 10-year exit. Free checklist.

Oct 10, 2026 · 9 min read
December 31, 2026 deferred-gain inclusion timelineInvestments made in 2019, 2021 and 2023 are all included in income on December 31, 2026; the 2019 lot gets a 15% basis step-up, the 2021 lot 10% and the 2023 lot none.201920202021202220232024202520262027 Dec 31, 2026: gain included Invested 201915% step-upInvested 202110% step-upInvested 2023no step-up

The December 31, 2026 opportunity zone tax: how to calculate your inclusion and fill in Form 8997

Every OZ 1.0 investor reports deferred gain on December 31, 2026. How to calculate it, the 10% and 15% step-ups, the FMV cap and what goes on Form 8997.

Oct 10, 2026 · 9 min read
When the 180-day clock startsA ring fills to 180 days. Start dates: the day of your own sale; each section 1231 sale; for K-1 gains the entity sale date, its year end or its return due date; each installment payment or year end; year end for section 1256 contracts. 180 days to invest the gain Your own salestarts: day of the sale§1231 propertystarts: day of each saleK-1 gainstarts: entity sale date, its year end, or its return due dateInstallment salestarts: each payment, or your year end§1256 contractsstarts: last day of your tax year

When does the opportunity zone 180-day clock start? Every start date, explained

Your 180 days to invest in a QOF start on different dates for stock, crypto, §1231 property, K-1 gains, installment sales and futures. Free date calculator.

Oct 10, 2026 · 7 min read
Reporting an opportunity zone deferralForm 8949 shows the sale with a $400,000 gain, then a second line with code Z and a negative $400,000 adjustment for the QOF deferral; Form 8997 Part II lists the QOF and the deferred gain.Form 8949, Part II (long-term) DescriptionSoldProceedsBasisCodeAdjustmentGain 100 sh XYZ03/14/26$750,000$350,000$400,000QOF deferral: Riverside QOF LLCZ($400,000)($400,000) Form 8997, Part II: gain deferred this year Riverside QOF LLC · EIN 84-1234567 · invested 05/02/26 · short/long-term: long-term Deferred gain $400,000 · attach every year you hold it

How to report an opportunity zone investment: Form 8949 code Z and Form 8997, line by line

Report the sale, add a Form 8949 line with code Z and the deferred gain as a negative adjustment, and attach Form 8997 every year. Free line builder.

Oct 10, 2026 · 8 min read
QOF 90% asset test gaugeA gauge needle sweeps to 79.5%, below the 90% threshold, then to 93%, which passes the Qualified Opportunity Fund asset test. 90% 79.5%: penalty months 93.0%: passes 0%100%

Form 8996 and the QOF 90% asset test, explained

How Form 8996 works: self-certifying a QOF, the two testing dates, the 6-month cash rule, the monthly penalty and reasonable cause. Free 90% test calculator.

Oct 10, 2026 · 8 min read