-Investor has up to 180 days to invest all or some of their capital gains into a QOF.
-Capital gain tax can be deferred until the earlier of the sale of the fund interest or December 31, 2016.
-After 5 years, investors will receive a basis increase equal to 10% of the original capital gain invested in the QOF. Therefore, it will reduce the investor’s deferred tax payment by 10%.
-After 7 years, investors will receive an additional 5% basis increase. This will further reduce the investor’s deferred tax payment by a total of 15%.
-After 10 years, investors may receive a full exemption from tax on unrealized capital appreciation of investments in the QOF.
*Disclaimers: Chessboard Capital, Inc. does not provide any tax advisory and does not guarantee the accuracy of the QOF info above. Chessboard Capital, Inc. recommends investors to consult with tax advisors to verify potential tax benefits.
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