I heard some deadlines and restrictions have been extended or changed.
The IRS has generally extended all deadlines that would have fallen between April 1, 2020 and Dec. 31 2020 to Dec. 31, 2020. This includes the 180-day deadline, the 90% test, and in effect, the 70% test at the QOZB level. For the 30-month substantial improvement period, the timer is tolled until Dec. 31, 2020. For the working capital safe harbor, the notice adds another 24 months.
It is easier for testing. It provides more time.
There were benefits to investors and funds alike. If an investor's 180-day capital gain reinvestment clock was to run out between April 1, 2020 to Dec. 30, 2020, this notice allows them to defer their gain using the OZ program through Dec. 31, 2020. The QOF has been allowed a "free" reasonable cause exception usage through the same time horizon, which keeps the fund from recognizing a penalty for failure to meet the 90% standard. Any assets undergoing substantial improvement can omit the period between April 1, 2020 to Dec. 30, 2020, when calculating their 30-month investment period. The QOF is allowed up to 24 months to reinvest proceeds from a sale of property or return of capital without penalty. A QOZB can extend their 31 or 62-month working capital safe harbor by up to 24 months.
Individual taxpayers that recognize a gain on or after Oct. 4, 2019 and before July 4, 2020 will now have an extended due date to invest in a QOF until Dec. 31, 2020.
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