Seven Senators and nine members of the House of Representatives sent a letter to Treasury Secretary Steven Mnuchin in which they praise and raise concerns about Treasury’s proposed regulations. The signatories urge Sec. Mnuchin to address remaining questions on investments in operating businesses.
The letter asks Treasury to remove the requirement that an OZ business derive 50 percent of its gross income from active conduct of a trade or business in the qualified OZ, but simply require that it derive at least 50 percent of total gross income from the active conduct of its trade or business. The letter also seeks more timing flexibility for opportunity funds to make investments; says fund-level activity should not disallow the tax benefit to opportunity fund investors who don’t take distributions from the fund or sell their interest before the 10-year holding period, regardless of whether there is “churn” in the opportunity fund’s investments; and asks that future regulations include reasonable reporting requirements.
The letter was signed by: Sen. Cory Booker (D-NJ), Sen. Joni Ernst (R-IA), Sen. Cory Gardner (R-CO), Sen. Shelley Moore Capito (R-WV), Sen. Rob Portman (R-OH), Sen. Tim Scott (R-SC), Sen. Todd Young (R-IN), Rep. Chris Collins (R-NY), Rep. Suzan DelBene (D-WA), Rep. Mike Kelly (R-PA), Rep. Derek Kilmer (D-WA), Rep. Ron Kind (D-WI), Rep. James Sensenbrenner (R-WI), Rep. Terri Sewell (D-AL), Rep. Jason Smith (R-MO) and Rep. Steve Stivers (R-OH).