EFTA01375667.pdf

QOZ Definitions and Requirements QOZ Business Property Qualified Opportunity QOZ Zone Fund Business • Investors roll over capital gains from ■ Asset test — 70% of the tangible ■ Any tangible property located in a any asset sale into QOZ Fund within property owned or leased by the QOZ acquired after 2017 and held 180 days (only the gain portion is QOZ Business must be in QOZB through the Fund's holding period eligible for tax benefits) Property ■ Acquired through unaffiliated • QOZ Fund chooses date of ■ Income test - at least 50% of gross purchase (affiliate share max 20%) formation and self-certifies on Form income derived from QOZ Property 8896 at end of tax year • Either 'original use' of the QOZ ■ Active conduct of business - land property commences with the • 90% of QOZ Fund assets must be leases, NNN likely do not qualify QOZ Fund invested in QOZ property (QOZ stock, QOZ partnership interest or ■ No 'sin businesses' — gambling, or directly in QOZ Business Property) parlors, liquor stores etc. • Property is substantially improved • Compliance is tested on the 6th ■ Working capital safe harbor — less — QOZ Fund must invest more than month and on the last day of the than 5% of assets in cash or financial the original basis of the property taxable year - on average, 90% of property, except for working capital (excluding land) within 30 months assets must be 'good QOZ assets' held for up to 31 months for on these two dates, implying a 6-12 acquisition, construction, or month period to commit available substantial improvement (as fund capital to deals evidenced by a written schedule) 31 CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0071223 CONFIDENTIAL SDNY_GM_00217407 EFTA01375667