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Does a fund need to file with the SEC for my investments to qualify for the OZ tax incentive?

How can I do my due diligence and check that all forms are correctly filed? Is that public information?

  • Guy Nicio
    October 04, 2019

    No, the SEC requirements have nothing to do with OZ tax incentives. The requirement to do that (or not) is the same without regard to OZ tax incentives. No, it would not be public information unless it were a public company/investment. Since those requirements are not connected to OZ tax incentives, they do not fall within our expertise. That question would be better answered by a law firm with experience in this area. Due diligence can be done by a qualified attorney or similar, we do not provide such services within our accounting firm.

  • Marc Schultz
    October 05, 2019

    I am not a securities lawyer. You should consult with one here. There is information on the IRS website. However, you should engage an accountant knowledgeable about the incentive who can keep track of the filings.

  • Matthew Rappaport
    October 06, 2019

    SEC filings are not a requirement for the program. IRS and SEC rules and regulations are distinct from each other, and unless expressly stated somewhere, one is independent from the other. There is nothing in the OZ rules that expands the securities obligations of any OZ entity; the securities considerations are evaluated as normal. If a QOF is otherwise exempt from securities reporting, the OZ rules in the tax code do not impose securities reporting.

  • Maria De Los Angeles Rivera
    October 06, 2019

    The fund does not need to register with the SEC unless required by applicable securities law. Therefore, not all funds will have publicly available documents. You must require these from the fund manager or sponsor in order to perform a due-diligence process according to your needs and goals.

  • Peter McNeil
    October 04, 2019

    No. There are separate rules for when a fund must file with the SEC. Those are separate rules. Even if a fund was required to file with SEC and failed to do so, tax benefits of the OZ fund would not be impacted, but penalties may be due to the SEC. Consult an SEC specialist to see what exclusions for filing apply.


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