Opportunity zone fund raise: what a QOF shows investors
An opportunity zone raise targets investors with capital gains who want the tax treatment of IRC section 1400Z-2. The room must show the tax compliance plan as clearly as the real estate: zone eligibility, the 90% asset test, the substantial improvement plan and the timing rules investors face.
- 180 daysWindow to invest eligible gain in a QOF, IRC 1400Z-2(a)(1)(A)
- 90%Share of QOF assets that must be qualified opportunity zone property, IRC 1400Z-2(d)(1)
- 30 monthsPeriod to substantially improve an acquired building, IRC 1400Z-2(d)(2)(D)(ii)
Folder index
- 01 Fund overview Strategy, target zones, fund size, minimums, timeline and contacts.
- 02 Zone eligibility Census tract numbers, designation evidence, maps for each property.
- 03 Tax structure Tax counsel memo, QOF self-certification approach, 90% test monitoring plan.
- 04 Pipeline Properties owned or under contract, business plans, budgets.
- 05 Substantial improvement Basis at acquisition, improvement budget, 30-month schedule per building.
- 06 Working capital Written plan and schedule for any working capital safe harbor relied on.
- 07 Sponsor Team, development track record, compliance staff.
How this raise works
A qualified opportunity fund is a corporation or partnership that invests in qualified opportunity zone property. Investors put eligible gain into the fund within 180 days of the sale that produced it and can defer tax on that gain. If they hold for at least 10 years, they may elect to have their basis in the fund interest set at fair market value, so appreciation inside the fund is not taxed on sale.
The statute was amended in 2025. For amounts invested after December 31, 2026, deferral runs on a rolling five-year clock from the date of investment and a five-year hold adds a basis step-up of 10% of the deferred gain, or 30% for qualified rural funds. New zone designations and transition guidance are being issued, so check current IRS guidance before you write the offering materials.
Investors and their accountants test compliance, not just returns. The fund must hold at least 90% of its assets in qualified opportunity zone property, measured on average at the midpoint and end of its tax year. Existing buildings must be substantially improved, meaning basis additions over a 30-month period exceed the building's adjusted basis at acquisition, with a lower threshold in rural zones. A fund that misses these tests risks penalties and the investors' tax benefits.
Best data rooms for this raise
The 16 rooms re-ranked with this raise's weights. Investor tracking carries the most weight here.
- Investor tracking 23%
- Permission control 17%
- Raise workflow 22%
- Investor onboarding 20%
- Cost of a raise 17%
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Full deal room with AI, a listed price and a 14-day free trial.
Price $149 a month Trial 14-day free trial Features 8 of 12 listed -
Long-running M&A platform with layered permissions and fast support.
Price Priced on request Trial Free trial available Features 9 of 12 listed -
Bank-grade platform for large processes, with AI and a mobile app.
Price Priced on request Trial Demo on request Features 10 of 12 listed -
Deal room with AI and readiness tools for preparing a process.
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Simple flat-rate deal room with signing and Q&A.
Price $250 a month Trial Free trial available Features 8 of 12 listed -
Easy, reliable deal room favored by mid-market advisers.
Price Priced on request Trial Free trial available Features 7 of 12 listed -
Content cloud with watermarks and signing, priced per user.
Price $15 a user a month Trial Free trial available Features 9 of 12 listed -
Deal room with a listed monthly price and an open API.
Price $299 a month Trial Free trial available Features 7 of 12 listed -
One of the oldest deal rooms, common on bank-led transactions.
Price Priced on request Trial Demo on request Features 8 of 12 listed -
European deal room strong in real estate, with AI features.
Price Priced on request Trial Demo on request Features 8 of 12 listed
Places 11 to 16: DealRoom (7.0), SmartRoom (6.9), ShareVault (6.7), Venue by DFIN (6.3), Digify (6.2), DocSend (6.0)
Folder index for the room
A starting index for this raise. Number the folders so the order survives exports and investors can cite them in questions.
- 01 Fund overviewStrategy, target zones, fund size, minimums, timeline and contacts.
- 02 Zone eligibilityCensus tract numbers, designation evidence, maps for each property.
- 03 Tax structureTax counsel memo, QOF self-certification approach, 90% test monitoring plan.
- 04 PipelineProperties owned or under contract, business plans, budgets.
- 05 Substantial improvementBasis at acquisition, improvement budget, 30-month schedule per building.
- 06 Working capitalWritten plan and schedule for any working capital safe harbor relied on.
- 07 SponsorTeam, development track record, compliance staff.
- 08 Offering documentsPPM with tax risk factors, LPA or operating agreement, subscription documents.
- 09 Investor tax formsGuide to the deferral election and Form 8997 reporting, timing checklist for the 180-day window.
- 10 Q&AInvestor and adviser questions with answers reviewed by tax counsel.
Features this raise needs
| Feature | Why | Ellty | iDeals | Datasite | Ansarada | SecureDocs | Firmex |
|---|---|---|---|---|---|---|---|
| Q&A module | LPs and lead investors post questions on a file; the deal team routes each one, drafts a reply and decides who sees it. | ||||||
| NDA e-sign step | Confidentiality terms an investor must accept in the room before folder one appears. | ||||||
| Investor activity log | A per-investor record of opens, pages and minutes, which tells the IR team who is in diligence and who stalled. | ||||||
| Dynamic watermarks | Stamps the reader and a timestamp over every page, so a PPM that leaks carries its source with it. |
Setting up the room
- 01
Confirm the current rules
The 2025 amendments changed deferral and step-up terms for new investments. Have tax counsel confirm which rules apply to your closing dates.
- 02
Map every property to a tract
List the census tract for each asset with evidence it is a designated zone for the relevant period.
- 03
Document the compliance plan
Show how the fund will meet the 90% test and how each building will meet substantial improvement within 30 months.
- 04
Help investors with timing
Investors work against a 180-day window from their gain. Publish closing dates early and keep subscription documents ready.
- 05
Keep tax answers consistent
Route tax questions through Q&A with counsel review so every investor gets the same answer.
Common mistakes
- Using pre-2025 deferral and step-up language in offering materials for 2027 investments.
- Buying an existing building without a budget that meets the substantial improvement test.
- Holding raised cash too long without a written working capital plan.
- Leaving investors to work out the 180-day window on their own.
Calculators for this raise
Or take the four-question quiz and check the raise checklist.
Questions and answers
Who invests in opportunity zone funds?
Mostly individuals and families with recent capital gains, often from selling stock, a business or real estate, plus some family offices and corporations.
Is a QOF offering still a securities offering?
Yes. Interests in the fund are securities, so the raise usually relies on Regulation D and needs a PPM and subscription documents like any private fund.
What should the room show on tax?
Zone eligibility, the 90% test plan, substantial improvement budgets and a plain guide to the investor's own deadlines and forms, all reviewed by tax counsel.