SUBTITLE C. OPPORTUNITY ZONE TAX BENEFITS

(a) Section 47-1801.04 is amended by adding new paragraphs (39A), (39B), (39C), and (39D) to read as follows:

" (39A) "Qualified opportunity fund" shall have the same meaning as set forth in section 1400Z-2 of the Internal Revenue Code of 1986, approved December 22, 2017 (131 Stat. 2184; 26 U.S.C. § 1400Z-2) ("section 1400Z-2").

" (39B) "Qualified opportunity zone" shall have the same meaning as set forth in section 1400Z-2.

" (39C) "Qualified opportunity zone business" shall have the same meaning as set forth in section 1400Z-2.

" (39D) "Qualified opportunity zone business property" shall have the same meaning as set forth in section 1400Z-2.".

(b) Section 47-1803.03(a) is amended by adding a new paragraph (20) to read as follows:

" (20) Capital Gains. --

" (A) Deferral of a capital gains tax payment for investing in a qualified opportunity fund ("QOF") shall be realized only if the taxpayer invests in a QOF that meets the criteria set forth in subparagraph (D) of this paragraph;

" (B) Reduction of capital gains tax liability through a 10% step-up in basis, if invested in a QOF for 5 years prior to December 31, 2026, and an additional 5% step-up in basis, if invested in a QOF for 7 years prior to December 31, 2026, shall be realized only if the taxpayer invests in a QOF that meets the criteria set forth in subparagraph (D) of this paragraph;

" (C) Abatement of capital gains tax on an investment of capital gains in a QOF for at least 10 years before December 31, 2047, shall be realized only if the taxpayer invests in a QOF that meets the criteria set forth in subparagraph (D) of this paragraph;

" (D) To receive the benefits described in subparagraphs (A), (B), and (C) of this paragraph, the taxpayer shall:

" (i) Invest in a QOF that:

" (I) Is certified by the Mayor as an eligible QOF pursuant to subparagraph (E) of this paragraph;

" (II) Has invested at least the value of the taxpayer's investment in the QOF in a qualified opportunity zone in the District; and

" (III) Has submitted its IRS Form 8996 to the Office of Tax and Revenue for the tax year in which the taxpayer is seeking the benefits described in subparagraphs (A), (B), and (C) of this paragraph; and

" (ii) Submit an IRS Form 8997 to the Office of Tax and Revenue for the tax year in which the taxpayer is seeking the benefits described in subparagraphs (A), (B), and (C) of this paragraph.

" (E) To be certified by the Mayor as an eligible QOF, a QOF shall submit to the Mayor documentation showing:

" (i) That some or all of its investments in qualified opportunity zone businesses and qualified opportunity zone business property are in businesses or property that:

" (I) Have been selected by the District government for a grant, loan, tax incentive, tax abatement, or other benefit or incentive intended to promote economic or community development in the District;

" (II) Have been selected by the Office of the Deputy Mayor for Planning and Economic Development to manage the redevelopment of a property, with respect to a business, or that are owned or disposed of by the District government, with respect to a property;

" (III) Have an unconditioned resolution of support from the Advisory Neighborhood Commission in which the business or property is located or a conditional resolution of support from the Advisory Neighborhood Commission in which the business or property is located and the Mayor determines that each of the conditions of the resolution have been met; or

" (IV) Are located in the District and have been scored by the QOF using the Urban Institute's Opportunity Zone Community Impact Assessment Tool, or other assessment tool approved by the Mayor, and received a score of 75 (or its equivalent) or greater; and

" (ii) That the dollar amount of the investments that the QOF has made in qualified opportunity zone businesses and qualified opportunity zone business property meets the standards set forth in sub-subparagraph (i) of this subparagraph.".