The proposed January 10, 2019 IRS hearing on Opportunity Zone regulations released last year was postponed due to the government shutdown. The hearing would have provided the IRS and practitioners the opportunity to discuss the draft regulations to help the IRS understand issues that have been identified so the regulations can be refined to encourage investment. While some real estate projects are moving forward, the potential for new businesses to open in Opportunity Zones and create jobs has been limited in some contexts due to the uncertainty posed by regulations that many believe will be changed. With the government back in operation, the IRS is expected to issue notice of a new date for the hearing. While the timing remains unknown, it is likely the hearing will take place at least two weeks after the notice is issued.
Additional regulations that were originally expected in December were also delayed because the Treasury Department was shut down.
Since December 31, 2019 is the deadline for making investments to qualify for a full 15 percent exclusion of existing capital gains taxes, investors are eager to understand potential regulation changes so they can proceed with their investment plans.