1. Yes, that' s more or less accurate, though you should look briefly into inclusion events where the gain could come due even prior to sale.
2. Yes, NYS uncoupled. The taxpayer effectively can't defer NY taxes, but this doesn't affect treatment for federal taxes.
3. Yes, this is allowable. The OZ rules provide that K-1 gain passing through from a partnership can be deferred by an individual.
The taxpayer will require an election on Form 8949 and reporting on Form 8997, both attached to the Form 1040.
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Matthew E. Rappaport, Esq., LL.M.
Vice Managing Partner
Chair, Taxation Group
Falcon, Rappaport & Berkman PLLC
(516) 558-3377
mer@frblaw.com------------------------------
Original Message:
Sent: 12-09-2022 02:21 PM
From: Gabriel Bentovim
Subject: OPPORTUNITY ZONE DEFERRALS
i Have a Partnership client who had a significant capital gain on property sold in 2022. The partners reinvested the funds in an Opportunity Zone partnership at the individual level.
Three questions.
Is it true that the deferral will only last until December 31, 2026 at the latest or earlier if the QOZ is sold.
Did NYS uncouple from this deferral and the taxpayer pay NYS tax this year and as a result will be able to use a NYS modification in 2026 when they have to report the gain federally
The gain will be reported on a partnership return. The partners are investing in the QOZ at a personal level. Is this allowable
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Gabriel Bentovim
HOFFMAN & BENTOVIM, CPAs PC
Commack NY
631-499-1500
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