Does TT support opportunity zone related capital gains deferrals for 2019?

[tagteam]

"Does TT support opportunity zone related capital gains deferrals for 2019?"

No, not according to the list of 2019 Unsupported Calculations and Situations.

See https://digitalasset.intuit.com/DOCUMENT/A6nHfmlMg/010220-2019-unsupported-calcs-L1FQfTTgn.pdf

31. Deferred Gains for Qualified Opportunity Funds (Form 8949 for Codes Y and Z): The program
does not support the reporting of deferring tax on an eligible gain by investing in a QOF, by using
Code “Z” in column (f). The program does not support the reporting of the amount of eligible gain
that you previously deferred and now need to recognize by using Code “Y” in column (f).

[ryouts]

Are there plans to update the 2019 software to include the deferral election before taxes are due on April 15?

[tagteam]

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@ryouts wrote:

Are there plans to update the 2019 software to include the deferral election before taxes are due on April 15?

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Considering the election is in the unsupported list as of the beginning of January, the answer to that question is "probably not".

[David84]

This is very disappointing if the opportunity zone capital gains deferrals remain unsupported.  Pretty much makes my TT purchase worthless and will force me to use an accountant this year, which I suspect will end my long run as a devoted TT user and filer.

[tagteam]

@David84 I actually figured out how to defer the gain in the program, but there is a catch. First, you have to be using a desktop (not online) version of TurboTax and, second, you have to do an override on the capital gains worksheet. The latter means you cannot e-file; you have to print and mail your return (but it appears to work).

[David84]

Thank you for the advice.  I may try this and then proceed with the paper filing if everything looks good.  

[tagteam]

@David84 Just a hint: 

You need to open (if it is not already open) the Capital Gain (Loss) Transaction Worksheet and scroll down to Part IX. On Line 3 you will find "Deferral of gain under section 1400Z"; you will insert figures on that line.

[contango21]

Thanks for sharing!  Does this mean we simply use code Y to defer gains (instead of code Z).  

Sorry if I’m not understanding the obvious. They make it confusing by including the word “previously”. I invested in a QOF for the first time and did not previously defer a gain.

Thanks!!

[tagteam]

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@contango21 wrote:

Thanks for sharing!  Does this mean we simply use code Y to defer gains (instead of code Z). 

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I do not believe that is the case. I looked at Form 8949 and the code is still "Z" in column (f).

[contango21]

I did some research. The TaxAct software package seems to have a very straightforward method to defer gains used to invest in QOFs—complete with Code Z and form 8997.

I will download it, give it a try, and share my findings. I really wish TT could support this, as I have used it for over 20 years...   :(

[tagteam]

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@contango21 wrote:

I did some research. The TaxAct software package seems to have a very straightforward method to defer gains used to invest in QOFs—complete with Code Z and form 8997.

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 I reviewed the page for that product and Form 8997 does not have a checkmark to the left of the form, as do most other forms. I have my doubts as to whether it is actually supported.

[Kim H]

Did TaxAct work for you?  Agreed, so annoying the QOF is not supported as I've been using TT forever