This resource is credited to Griffin Capital.
QOZ Funds | 1031 Exchanges | |
|---|---|---|
Eligible Gains | Any capital gain, regardless of the asset that generated it | Limited to gains from real property held for investment or used tin a trade or business |
Reinvestment of Proceeds | Only reinvest capital gain; can reinvest basis but it will not receive tax benefits | Must reinvest all proceeds and have same or great amount of debt |
Time Period to Reinvest | 180 days (with certain exceptions); gain must be triggered on or before 12/31/2026 | 45-day identification period and 180 day reinvest period; no investment deadline |
Replacement Asset | Qualified Opportunity Fund (invests 90% of assets in QOZ Property) | Real property; must be "like-kind" |
Location of Replacement Asset | Designated Opportunity Zones | 50 U.S. states, D.C., Guam and Virgin Islands |
Qualified Intermediary | Not necessary | Generally required to hold proceeds or property |
Minimum Holding Period | At least 10 years to achieve maximum tax benefit | None, but subject to "held for" requirement |
Deferral of Capital Gain Tax on Relinquished Asset | Deferred until 2026; 10%/15% step-up in basis after 5/7 year holding period | Deferred indefinitely; may be eliminated upon investor's death |
Tax on Gain Generated by Replacement Asset | Eliminated if held 10 years; may be eliminated upon investor's death | Due upon sale of asset; may be eliminated upon investor's death |