The Tax Cuts and Jobs Act enacted section 1400Z-2 of the Internal Revenue Code, which created the qualified opportunity zone program. The program is designed to encourage investment in distressed communities designated as “qualified opportunity zones” by providing tax incentives to invest in “qualified opportunity funds” (“opportunity funds”) that, in turn, invest directly or indirectly in the opportunity zones.

The qualified opportunity zone program generally offers three potential tax benefits to investors:

First, a taxpayer may elect to defer tax on capital gain from the sale or exchange of property with an unrelated person by investing the gain as equity in an opportunity fund within 180 days after the sale or exchange.  The deferral ends on December 31, 2026, or sooner if the taxpayer sells its interest in the opportunity fund, and at that time the taxpayer must recognize the gain (and pay tax) with respect to the original property.

Second, if the taxpayer holds its interest in an opportunity fund for five years, it can step up its basis in the opportunity fund by an amount equal to 10% of the deferred gain with respect to the original property and, if the taxpayer holds its interest in the opportunity fund for seven years, it can step up its basis in the opportunity fund by an amount equal to an additional 5% of the deferred gain with respect to the original property (for a total of 15%). The stepped up basis reduces the amount of gain recognized by the taxpayer at the end of the deferral period.

Finally, if the taxpayer holds its interest in the opportunity fund for at least 10 years, it can step up its basis in its interest in the opportunity fund to the fair market value of the interest on the date the interest is sold (enabling the taxpayer to eliminate income tax on any post-acquisition capital gain in its opportunity fund interest, including any capital gain attributable to leverage incurred by the fund).

An in depth discussion of the opportunity zone program and the proposed regulations can be found here: https://www.proskauer.com/report/irs-and-treasury-issue-proposed-opportunity-zone-regulations.

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Photo of Amanda H. Nussbaum Amanda H. Nussbaum

Amanda H. Nussbaum is the chair of the Firm’s Tax Department as well as a member of the Private Funds Group. Her practice concentrates on planning for and the structuring of domestic and international private investment funds, including venture capital, buyout, real estate…

Amanda H. Nussbaum is the chair of the Firm’s Tax Department as well as a member of the Private Funds Group. Her practice concentrates on planning for and the structuring of domestic and international private investment funds, including venture capital, buyout, real estate and hedge funds, as well as advising those funds on investment activities and operational issues. She also represents many types of investors, including tax-exempt and non-U.S. investors, with their investments in private investment funds. Business partners through our clients’ biggest challenges, Amanda is a part of the Firm’s cross-disciplinary, cross-jurisdictional Coronavirus Response Team helping to shape the guidance and next steps for clients impacted by the pandemic.

Amanda has significant experience structuring taxable and tax-free mergers and acquisitions, real estate transactions and stock and debt offerings. She also counsels both sports teams and sports leagues with a broad range of tax issues.

In addition, Amanda advises not-for-profit clients on matters such as applying for and maintaining exemption from federal income tax, minimizing unrelated business taxable income, structuring joint ventures and partnerships with taxable entities and using exempt and for-profit subsidiaries.

Amanda has co-authored with Howard Lefkowitz and Steven Devaney the New York Limited Liability Company Forms and Practice Manual, which is published by Data Trace Publishing Co.

Photo of David S. Miller David S. Miller

David Miller is a partner in the Tax Department. David advises clients on a broad range of domestic and international corporate tax issues. His practice covers the taxation of financial instruments and derivatives, private and public REITs, cross-border lending transactions and other financings…

David Miller is a partner in the Tax Department. David advises clients on a broad range of domestic and international corporate tax issues. His practice covers the taxation of financial instruments and derivatives, private and public REITs, cross-border lending transactions and other financings, international and domestic mergers and acquisitions, multinational corporate groups and partnerships, private equity and hedge funds, bankruptcy and workouts, high-net-worth individuals and families, and public charities and private foundations. He advises companies in virtually all major industries, including banking, finance, private equity, health care, life sciences, real estate, technology, consumer products, entertainment and energy.

David is strongly committed to pro bono service, and has represented more than 500 charities. In 2011, he was named as one of thirteen “Lawyers Who Lead by Example” by the New York Law Journal for his pro bono service. David has also been recognized for his pro bono work by The Legal Aid Society, Legal Services for New York City and New York Lawyers For The Public Interest.

David has been consistently recognized by leading industry publications, such as Chambers Global, Chambers USA, Best Lawyers and The Legal 500. Clients surveyed by Chambers USA said, “We bring him in on complex matters because he has the experience and the gravitas.” David is one of 17 lawyers in the United States in The Legal 500’s Hall of Fame for US Tax (non-contentious).

David has taught the taxation of financial instruments at Columbia Law School, and tax policy at New York University School of Law. He is also a frequent author and has written a number of articles and chapters in various tax publications. David is the former chair of the tax section of the New York State Bar Association.

Prior to joining Proskauer, David was a partner at Cadwalader, Wickersham & Taft LLP.

Photo of Jean Bertrand Jean Bertrand

Jean Bertrand is a partner in the Tax Department and a member of the Private Funds Group. Jean advises clients on a broad range of domestic and international tax issues. Her practice focuses on hedge and private equity fund formation, investment structuring, cross-border…

Jean Bertrand is a partner in the Tax Department and a member of the Private Funds Group. Jean advises clients on a broad range of domestic and international tax issues. Her practice focuses on hedge and private equity fund formation, investment structuring, cross-border lending transactions and other financings, and providing general tax advice to corporations, partnerships, high-net-worth individuals and families. In addition, Jean has significant experience in advising public charities, private foundations and other tax-exempt organizations on structural and operating matters, including obtaining tax-exempt status, managing unrelated business taxable income, complying with the excess benefit transaction rules, grant-making, fundraising, and structuring investments.

Prior to becoming a lawyer, Jean was registered as a certified public accountant in New York and worked for several years as an auditor at a major public accounting firm. Prior to joining the Firm, Jean was a Special Counsel at Cadwalader, Wickersham and Taft LLP.

Photo of Jamiel E. Poindexter Jamiel E. Poindexter

Jamiel E. Poindexter is a partner in the Tax Department and a member of the Private Funds Group. He focuses on tax and economic issues associated with the formation of and investments in U.S. and non-U.S. venture capital funds, buyout funds, funds-of-funds, secondary…

Jamiel E. Poindexter is a partner in the Tax Department and a member of the Private Funds Group. He focuses on tax and economic issues associated with the formation of and investments in U.S. and non-U.S. venture capital funds, buyout funds, funds-of-funds, secondary funds, and other investment partnerships.

Jamiel advises U.S. and non-U.S. sponsors and institutional investors on all types of fund-related transactions and operations, including:

  • structuring and raising private investment funds;
  • investments by institutional investors in private investment funds;
  • buy-side secondary transactions and sell-side secondary transactions;
  • restructuring of existing funds;
  •  spin outs;
  • succession planning; and
  • portfolio company investments.
Photo of Martin T. Hamilton Martin T. Hamilton

Martin T. Hamilton is a partner in the Tax Department. He primarily handles U.S. corporate, partnership and international tax matters.

Martin’s practice focuses on mergers and acquisitions, cross-border investments and structured financing arrangements, as well as tax-efficient corporate financing techniques and the tax…

Martin T. Hamilton is a partner in the Tax Department. He primarily handles U.S. corporate, partnership and international tax matters.

Martin’s practice focuses on mergers and acquisitions, cross-border investments and structured financing arrangements, as well as tax-efficient corporate financing techniques and the tax treatment of complex financial products. He has experience with public and private cross-border mergers, acquisitions, offerings and financings, and has advised both U.S. and international clients, including private equity funds, commercial and investment banks, insurance companies and multinational industrials, on the U.S. tax impact of these global transactions.

In addition, Martin has worked on transactions in the financial services, technology, insurance, real estate, health care, energy, natural resources and industrial sectors, and these transactions have involved inbound and outbound investment throughout Europe and North America, as well as major markets in East and South Asia, South America and Australia.

Martin also regularly represents clients in tax controversies and other matters before the U.S. tax authorities.

Photo of Mitchell Gaswirth Mitchell Gaswirth

Mitchell M. Gaswirth is a partner in the Tax Department. His practice focuses primarily on income, gift and estate tax and related business planning. Mitchell counsels individuals, entrepreneurs and business entities in connection with the myriad income and other tax issues arising in…

Mitchell M. Gaswirth is a partner in the Tax Department. His practice focuses primarily on income, gift and estate tax and related business planning. Mitchell counsels individuals, entrepreneurs and business entities in connection with the myriad income and other tax issues arising in sophisticated business transactions.

Mitchell’s practice also encompasses a wide array of merger and acquisition, business formation and financing, debt restructuring, and real property acquisition, disposition and exchange transactions. His knowledge encompasses the complex and often arcane application of California’s property tax regime (“Proposition 13”) in a variety of business transactions directly or indirectly involving California real property.

In addition, he provides income, gift and estate tax and related business planning advice to individuals, families, and their business enterprises to help them achieve wealth preservation and tax minimization objectives. This planning includes tax minimization strategies involving grantor trusts, family limited partnerships, charitable and family “split interest” and other irrevocable trusts, and other sophisticated wealth transfer and business succession vehicles. Mitchell’s wealth transfer tax planning practice focuses particularly on counseling executives, professionals, investors, and others concerning the preservation, administration and disposition of their capital. He also counsels individuals and businesses in connection with planning to minimize California income tax burdens.

Mitchell also represents corporate and individual fiduciaries, and estate and trust beneficiaries, in a wide array of sophisticated personal planning and fiduciary administration matters, including representing U.S. Trust, JPMorgan Chase Bank and Wells Fargo Bank, in their administrations of complex trust arrangements for high net worth families. His fiduciary practice also encompasses substantial “Family Office” representation for multi-member families seeking to achieve complex and sophisticated income and wealth transfer tax objectives.

Mitchell’s tax practice also involves the administrative and judicial resolution of tax disputes with federal and state tax authorities. He represents taxpayers in income, estate and gift, sales and use, property, and employment tax disputes with the Internal Revenue Service, California Franchise Tax Board, and other tax authorities. Notably, Mitchell served as Lead Tax Counsel to the late Paul Newman, both at trial and in the California Court of Appeals, in the actor’s successful refund suit against the California Franchise Tax Board. The Newman case established the impropriety of the Franchise Tax Board’s formula for apportioning to California a non-resident entertainer’s income derived from both California and non-California sources.

Prior to joining Proskauer, Mitchell was a partner of the Los Angeles law firm Mitchell, Silberberg & Knupp.

Photo of Malcolm Hochenberg Malcolm Hochenberg

Malcolm S. Hochenberg is a partner in the Tax Department. Malcolm’s practice involves helping clients achieve all tax and other commercial objectives in an array of industries.

Malcolm often works with companies in the context of an M&A transaction and then becomes a…

Malcolm S. Hochenberg is a partner in the Tax Department. Malcolm’s practice involves helping clients achieve all tax and other commercial objectives in an array of industries.

Malcolm often works with companies in the context of an M&A transaction and then becomes a day-to-day advisor to the organization and/or its owners. Malcolm also has extensive experience restructuring companies in distressed and non-distressed situations. Within the Firm and among clients, he is known for his proactive, solution-oriented approach.

Malcolm’s experience includes work in the following disciplines:

M&A

Private equity funds in dozens of acquisitions, dispositions and related financings

Acquisitions and dispositions by and of public companies

Mergers and consolidations of registered funds

Sales of professional sports franchises and other gaming businesses

Advisory and Restructuring

Reorganizing global structures for multinational firms,

Work both near and in bankruptcy, including Chapter 11 restructurings and representing ad hoc groups of private credit lenders in Chapter 11 and 363 sale processes

Designing and implementing structures for sports tournaments and other JVs involving sporting events

Working with companies in the context of tax audits and refund claims

Venture Capital and Intellectual Property

Licensing and other collaboration agreements for for-profit and tax-exempt organizations

Structuring start-ups and representing early stage investors

Representing investors in the context of transformative transactions for underlying portfolio companies

Capital Markets

IPOs, debt and equity offerings and tack-ons, including via “Up-C” structure with tax receivables agreement

Real Estate

Joint ventures, as well as acquisitions and dispositions of realty, in both contexts structuring for tax sensitive investors

Sejin Park

Sejin Park is an associate in the Tax Department. Sejin’s practice focuses on advising clients on tax matters in domestic and cross-border transactions related to capital markets, finance, mergers & acquisitions and bankruptcy.