Morris Manning & Martin, LLP

MMM Launches Opportunity Zone Group, Analyzes IRS Guidance

10.25.2018

Atlanta (October 2018) – Morris, Manning & Martin, LLP has launched a new Opportunity Zone Practice Group to help clients navigate the ins and outs of the new economic development program. The group, which informally began work earlier this year, now has more than 20 tax, real estate, finance and corporate attorneys focused on helping a wide variety of clients receive tax benefits in exchange for investing in low-income areas.

Opportunity Zones or, more formally, Qualified Opportunity (QO) Zones, are low-income communities the government approved as needing economic revitalization through new capital investment. Taxpayers who sell investments – such as property or stocks – that generate capital gains can receive substantial additional returns on investment in the form of tax savings by reinvesting those gains in a QO Fund. The goal is to encourage new development and job creation in the zones by rewarding investors willing to take risks with significant tax benefits. All 50 states, five territories, and the District of Columbia now have approved zones.  

“The guidance is out, and the floodgates are now open for deals,” said the group’s Co-Chair Matt Peurach. “The new group will help fund sponsors, developers and investors navigate the new Opportunity Zone rules and regulations in order to properly form and structure their QO Funds to take advantage of the new program.”

This week MMM generated a detailed analysis of recently-released Treasury and Internal Revenue Service guidance on the program. While the guidance itself is publicly available, MMM explains the fine points in a clear and useful question and answer format.

“We went through the IRS guidance point-by-point to help people understand what the guidance means and how it could affect their tax strategies,” Co-Chair Tim Pollock said. “Investors, developers and fund sponsors can now execute on opportunities they’ve been eyeing for several months.”

MMM’s analysis addresses the types of gains that can be deferred, the taxpayers eligible to invest in the funds, important timing issues, action items, potential penalties and more. It also includes a link to the guidance itself.

The firm already has deep experience in Opportunity Zones and QO Funds. It has counseled fund sponsors, developers and investors on roughly $350 million in pending fund-related matters. Plus, Peurach has spoken at conferences hosted by the Institute for Portfolio Alternatives (IPA), Bisnow and Novogradac. Upcoming appearances include a pre-conference roundtable at InterFace Multifamily Southeast. His articles on the topic have appeared in Institutional Real Estate Investor’s Real Assets magazine, the Georgia Society of CPA's Current Account and the website of the Urban Land Institute’s Atlanta chapter.

To download MMM’s framework examining the new guidance, click here. While it should not be construed as legal or investment advice, the information could help a wide variety of participants. Although the regulations are currently in proposed form, taxpayers and fund sponsors may rely on them as long as they apply the rules in their entirety and consistently.

About Morris, Manning & Martin, LLP
Morris, Manning & Martin (www.mmmlaw.com) is an AmLaw 200 law firm with national and international reach. We dedicate ourselves to the constant pursuit of our clients’ success. To provide our clients with optimal value, we combine market-leading legal services with a total understanding of their needs to maximize effectiveness, efficiency and opportunity. MMM enjoys national prominence for its real estate, corporate, litigation, technology, healthcare, intellectual property, energy & infrastructure, capital markets, environmental, international trade, and insurance practices. MMM has offices in and around Atlanta, Raleigh-Durham, Savannah and Washington, D.C. The firm also has a business development office in Beijing, China.