I hear that inventory in transit is still considered qualified opportunity zone business property. At what point does this stop being the case? Does it depend on the moment a sale contract is agreed, or is it from the moment it’s shipped by the vendor, the moment it’s physically received by the client, etc? Or does it depend on when the inventory actually enters or leaves the QOZ?
In the new regulations, it states that qualified inventory is deemed in transit if it is moving from vendor to a facility of the trade or business that is in a QOZ, or from a trade or business that is in a QOZ to a customer outside the QOZ. The regulations do not designate exact timing, but presumably from purchase date onward for inventory from vendor, and until delivery by carrier to the customer. The regulations likely will not make an exact measurement upon when the safe harbor will apply.
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