QOF: Belpointe PREP, LLC
To make a capital gains deferral election eligible taxpayers must file IRS Form 8949 (Sales and Other Dispositions of Capital Assets), which will need to be attached to their U.S. federal income tax returns for the taxable year in which the capital gain would have been recognized had it not been deferred.
In addition, Form 8997 (Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments) requires eligible taxpayers holding a qualified opportunity fund investment at any point during the tax year to report:
(i) qualified opportunity fund investments holdings at the beginning and end of the tax year;
(ii) current tax year capital gains deferred by investing in a qualified opportunity fund; and
(iii) qualified opportunity fund investments disposed of during the tax year.
You are urged to consult with your own tax advisors regarding:
(i) procedures you will need to follow to defer capital gains through investing in a qualified opportunity fund;
(ii) tax consequences of purchasing, owning or disposing of our Class A units, including the federal, state and local tax consequences of investing capital gains in our Class A units;
(iii) tax consequences associated with our election to qualify as a partnership for U.S. federal income tax purposes and our election to qualify as a qualified opportunity fund; and
(iv) tax consequences associated with potential changes in the interpretation of existing tax laws or the adoption of new laws or regulations.