Ask A Question

How can operating businesses that lease property qualify as QOZBs?

I heard the new regs allowed for this if certain conditions are met. Is that true? What are the conditions?


Answers
  • Peter McNeil
    September 23, 2019

    The leased property must be valued. Then it can be counted a qualifying tangible property. Use an MAI to be safe.

  • Matthew Rappaport
    September 08, 2019

    Leasing property should be OK as long as the taxpayer meets original use/substantial improvement and the lease is at FMV.

  • Maria De Los Angeles Rivera
    September 07, 2019

    The regulations state that the lease of property will constitute an active trade or business unless it is a triple-net type of lease. The property needs to comply with the same rules to be QOZBP: property purchased from an unrelated person after Dec. 31, 2017; property leased from an unrelated person after Dec. 31 2017, or from a related person at arm’s length market rates; original use of the property commences with the QOF or when the QOF substantially improves the property; and during substantially all (90%) of the QOF’s holding period of the tangible property, substantially all (70%) of the use of the tangible property was in a QOZ

  • Brad Cohen
    September 06, 2019

    True. Lease has several requirements. It's easy to comply.

  • DISCLAIMER: 

    the information found on this website is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your particular situation. You should seek consultation with legal and financial experts prior to participating in any aspect relating to Opportunity Zones. Posting a question on this website does not create an attorney-client relationship. All questions you post will be available to the public; do not include confidential information in your question.