The U.S. Internal Revenue Service (IRS) issued more proposed regulations (REG-120186-18) on Sec. 1400Z-2, a new provision added by the law known as the Tax Cuts and Jobs Act (TCJA), that establishes qualified opportunity funds (QOF) to encourage investments in low-income communities. Sec. 1400Z-2 offers three federal income tax incentives to a taxpayer who invests in a business located within a qualified opportunity zone (QOZ): (1) the temporary deferral of capital gains, to the extent the gains are reinvested into a QOF; (2) the partial exclusion of previously deferred gains when certain holding period requirements in a QOF are met; and (3) the permanent exclusion of post-acquisition gains from the sale of an investment in a QOF held longer than 10 years. Read more at The Tax Adviser.