QOZ Fund Exit Calculator

QOZ 10-year exit provides permanent tax-free appreciation.

Initial investment

Exit sale price

Combined tax rate %

Years held

Tax-free gain (if 10+ yr)

$1,500,000

Tax saved

$450,000

After-tax value

$2,500,000

How the math works

10+ year hold: gain = sale − initial. Tax saved = gain × rate. After-tax value = full sale price.

$2.5M − $1M = $1.5M gain. Tax saved at 30% = $450k. Full $2.5M retained after 10-year tax-free exit.

How to Use

Enter initial investment.
Enter exit sale price.
Enter combined tax rate %.
Enter years held.
Read tax-free gain value.

Frequently Asked Questions

What is the QOZ 10-year exit?

Opportunity Zone investments held 10+ years qualify for permanent step-up in basis to fair market value at sale — eliminating capital gains tax on the QOZ investment's appreciation. Combined with 7-year deferral benefit (reduced) and basis step-up, creates triple tax benefit. Among the most powerful federal tax incentives for real estate. Originally created by 2017 TCJA; deferral element sunset 12/31/2026; basis step-up continues through 12/31/2047.

Deferral timeline?

Original deferral: gains invested in QOZ fund defer until 12/31/2026. After that, tax due on original deferred gain (not fund appreciation). 10% step-up at 5 years, 15% step-up at 7 years (reduced pre-2026 deferral tax). 10-year hold = 100% tax-free on fund appreciation. 2026 sunset drives the December 2026 scramble — many funds structuring accelerated exits around this date.

Eligible investment types?

Real estate: must be in designated opportunity zone (9,000+ US census tracts). Operating businesses: QOZ business activities. Requires 'substantial improvement' (double basis of acquired property within 30 months) for real estate purchases. New construction simpler — no existing basis to double. Ground-up developments common. Rehabs complex. Hold 10+ years.

Exit strategy considerations?

Year 10 exit: full tax-free appreciation benefit. Before year 10: partial tax-free benefit; lose 10-year benefit. Exit through: (1) fund sale to another QOZ fund, (2) direct asset sale, (3) UPREIT exchange (into public REIT), (4) recapitalization/refinance. Each has different tax treatment. Experienced tax attorney essential — QOZ rules complex and regulatory interpretations evolving.