An investor has 180 days to put an eligible gain into a Qualified Opportunity Fund, and the period begins on the day the gain would otherwise be recognized for federal tax purposes (26 CFR 1.1400Z2(a)-1(b)(7)(i)). That start day counts as day 1, so the last day to invest is 179 days later; partnership, REIT, section 1256, installment and inclusion-event gains have their own start dates, set out in the table below.
The 180-day requirement itself is in the statute, at 26 U.S.C. 1400Z-2(a)(1)(A), and the 2025 law did not change it. What varies is the start date. The regulations give several, and some are elective.
Key points
- Day 1 is the start date. Day 180 is the start date plus 179 days.
- Direct sales and section 1231 gains start on the sale date.
- Pass-through gains default to the last day of the entity's tax year, with two elective alternatives for partners.
- REIT and RIC capital gain dividends default to the shareholder's year end, or the payment date by choice.
- The date you invest, not the date you sold, decides OZ 1.0 or OZ 2.0.
How to count the 180 days
The regulation defines the 180-day period as the period that "begins on the day on which the gain would be recognized" if no deferral election were made. The period therefore includes its start day. Counting that day as day 1, the 180th day falls 179 days later. The site's 180-day deadline calculator counts the same way.
The investment has to be made in the fund, for an equity interest, by the last day. Where the regulations offer an elective start date, the choice moves the deadline, so each option is shown separately below.
Every start date, with examples
The dates in the last two columns are hypothetical and assume calendar-year taxpayers and entities.
| Source of the gain | Start date (day 1) | Rule | Example start | Last day to invest |
|---|---|---|---|---|
| Direct sale of a capital asset | Day the gain would be recognized | (b)(7)(i) | Mar 10, 2027 | Sep 5, 2027 |
| Qualified section 1231 gain | Day the gain would be recognized (the sale date) | (b)(11)(iii)(B), (b)(7)(i) | Jun 1, 2027 | Nov 27, 2027 |
| Partner's share of partnership gain, default | Last day of the partnership's tax year | (c)(8)(iii)(A) | Dec 31, 2027 | Jun 27, 2028 |
| Partner election: partnership's own period | Partnership's sale date | (c)(8)(iii)(B)(1) | Mar 10, 2027 | Sep 5, 2027 |
| Partner election: return due date | Unextended due date of the partnership return for the year of the sale | (c)(8)(iii)(B)(2) | Mar 15, 2028 | Sep 10, 2028 |
| S corporation, nongrantor trust, estate | Rules analogous to partnerships | (c)(9)(i) | Dec 31, 2027 | Jun 27, 2028 |
| REIT or RIC capital gain dividend, default | Last day of the shareholder's tax year | (b)(7)(ii)(A) | Dec 31, 2027 | Jun 27, 2028 |
| REIT or RIC capital gain dividend, election | Dividend payment date | (b)(7)(ii)(B) | Jun 1, 2027 | Nov 27, 2027 |
| Undistributed RIC or REIT capital gains | Last day of the fund's tax year or of the shareholder's tax year, at the shareholder's election | (b)(7)(ii)(C) | Dec 31, 2027 | Jun 27, 2028 |
| Net gain from qualified section 1256 contracts | Last day of the tax year | (b)(11)(vi)(B) | Dec 31, 2027 | Jun 27, 2028 |
| Excepted net gain from an identified straddle | Earlier of disposal of all positions or the last day of the tax year | (b)(11)(vi)(C)(4) | Mar 10, 2027 | Sep 5, 2027 |
| Installment sale gain, per payment | Each payment date (each payment starts a new period) | (b)(11)(viii)(B) | Jun 1, 2027 | Nov 27, 2027 |
| Installment sale gain, year end | Last day of the tax year the gain is recognized | (b)(11)(viii)(B) | Dec 31, 2027 | Jun 27, 2028 |
| Gain from an inclusion event on a QOF investment | Date of the inclusion event | (b)(11)(iv)(B) | Mar 10, 2027 | Sep 5, 2027 |
2028 is a leap year, which is why a December 31, 2027 start ends on June 27, 2028 rather than June 28.
Partnership gains in detail
A partnership can defer its own gain by investing within its own 180 days, which start on its sale date. If it does not defer all of its eligible gain, each partner may defer its distributive share. The partner's default period starts on the last day of the partnership's tax year in which the partner's share is taken into account (26 CFR 1.1400Z2(a)-1(c)(8)(iii)(A)).
Two elective alternatives exist under paragraph (c)(8)(iii)(B). The partner may use the same 180-day period as the partnership, starting on the sale date. Or the partner may start the period on the due date of the partnership's return, without extensions, for the year the partnership realized the gain. The regulation's own example has a partner who learns of the gain from a Schedule K-1 issued March 15 and invests in June under the due-date option.
Paragraph (c)(9)(i) applies analogous rules to S corporations, nongrantor trusts and decedents' estates. For grantor trusts, either the trust or the deemed owner may elect and invest, but the special partner start dates in paragraph (c)(8)(iii) do not apply.
REITs, section 1256 contracts and installment sales
REIT and RIC dividends. The default start is the last day of the shareholder's tax year. Choosing the payment date instead caps the eligible amount at the capital gain dividends the REIT designated or the RIC reported for that shareholder for the year. Undistributed capital gains cannot use the payment-date choice.
Section 1256 contracts. Only the net gain for the year from qualified section 1256 contracts is eligible, so the period starts on the last day of the tax year, once the net is known.
Installment sales. The investor may start a new 180-day period on each payment date or use one period starting on the last day of the tax year in which the gain is recognized. Installment sales from before December 22, 2017 are included. See eligible gains for which gains qualify in the first place.
Gain from an inclusion event
When an inclusion event, such as a sale of a QOF interest, ends a deferral, the resulting gain can itself be invested in a new QOF. Its 180 days begin on the date of the inclusion event, and the regulation treats the gain as if it were first realized on that date (26 CFR 1.1400Z2(a)-1(b)(11)(iv)). The holding period of the new investment begins when the gain is reinvested.
The OZ 1.0 gain that is recognized on December 31, 2026 simply because an investment was still held is different. Notice 2026-40 sec. 4.01(2) says that gain cannot be deferred again. See inclusion events and the December 31, 2026 gain inclusion.
Windows that straddle January 1, 2027
OZ 1.0 means investments made on or before December 31, 2026; OZ 2.0 means investments made after that date. The investment date, not the sale date, decides the regime. Notice 2026-40 sec. 4.02(2) says eligible gain realized on, before or after December 31, 2026 and invested on or after January 1, 2027, within its 180-day window, can be deferred under the new rules.
Hypothetical example
Suppose an individual sells stock on September 1, 2026. Day 1 is September 1, 2026, and day 180 is February 27, 2027.
If the investor buys into a QOF on December 15, 2026, that is an OZ 1.0 investment: the deferred gain is included in income for the tax year that includes December 31, 2026, so the deferral lasts about two weeks. If the investor instead invests on January 12, 2027, still inside the window, the investment is OZ 2.0, with a 5-year deferral and a 10 percent step-up if held 5 years. Dates are illustrative only.
This page explains how the rule works and does not recommend a timing choice. The trade-offs are covered on invest in 2026 or wait for 2027, and the transition checker sorts a gain date into the regime it can reach.
Reporting the election
The election is made in the time, form and manner set by IRS forms and instructions (26 CFR 1.1400Z2(a)-1(d)(1)). On Form 8949, the deferral goes on its own row with the fund's EIN, the investment date, code Z in column (f) and the deferred amount as a negative number in column (g) (Form 8949 instructions). The investor also files Form 8997. Step-by-step instructions are on how to report an Opportunity Zone investment.
This page is general information, not tax advice. A tax adviser can confirm which start date applies to a specific gain and how to document the choice.
Common questions
Is the sale date day 1 of the 180-day period?
Yes. The regulations say the 180-day period begins on the day the gain would be recognized, so that day is the first of the 180 days and the last day to invest is 179 days after it. A gain recognized on March 10, 2027 has a last investment day of September 5, 2027.
When does the 180-day period start for gain from a partnership K-1?
By default it starts on the last day of the partnership's tax year, which is December 31 for a calendar-year partnership. A partner may instead elect the partnership's own 180-day period, which starts on the sale date, or a period starting on the unextended due date of the partnership's return.
When does the 180-day period start for REIT capital gain dividends?
By default on the last day of the shareholder's tax year. The shareholder may instead start it on the date the dividend is paid, with the eligible amount limited to the capital gain dividends reported or designated for that shareholder for the year.
Does each installment payment get its own 180-day window?
It can. For installment sale gain, the investor may treat each payment date as the start of a new 180-day period, or start a single period on the last day of the tax year in which the gain is recognized.
If I sell in 2026 and invest in 2027, which rules apply?
Notice 2026-40 sec. 4.02(2) says eligible gain realized on, before or after December 31, 2026 that is invested in a QOF on or after January 1, 2027, within its 180-day window, can be deferred under the OZ 2.0 rules. An investment made on or before December 31, 2026 is OZ 1.0.