IRS Seeks Additional Information from QOFs Filing Form 8996, Form 8997

Tuesday, April 12, 2022 - 10:30am

The Internal Revenue Service (IRS) announced Tuesday in a news release that some qualified opportunity funds (QOFs) that filed Form 8996 may receive one of three letters seeking additional information about opportunity zones (OZ) investing. Some QOFs that attached Form 8996 to their returns may receive Letter 6501, which seeks additional information to support the annual certification of investment standard requirement. Filers of Form 8997 may receive either Letter 6502, Reporting Qualified Opportunity Fund Investments, or Letter 6503, Annual Reporting of Qualified Opportunity Fund Investments. For recipients of any of the three letters, additional details are required. QOFs may need to file an amended return or an administrative adjustment request (AAR) to meet the requirement. Possible consequences of inaction vary from further IRS examination to recipients owing taxes, interest and penalties on gains not properly deferred.

To stay current on all the latest OZ guidance, join Novogradac and other OZ leaders at the upcoming Novogradac 2022 Spring Opportunity Zones Conference April 21-22 in Long Beach, California.