Frequently Asked Questions

The capital gains must be invested in qualified opportunity funds that have 90% of their assets invested in qualified opportunity zones.

All capital gains on the sale or or exchange of any property to an unrelated party invested within 180 days are eligible for the tax benefits.

The minimum investment is -$50,000

Yes. Opportunity Funds are designed to be easier with less hassle than 1031 Exchanges.

Qualified opportunity stock, partnership interest, or business property are all eligible investments. The Sikari Opportunity Fund is qualified opportunity stock only. Meaning you are investing the entire interest of the company and its holdings.

Investors can invest in opportunity funds by selling an asset and triggering a capital gain, then subsequently placing that gain in a qualified opportunity fund with 180 days of the original sale. There is a subscription agreement that is signed by the investor and a wire transfer agreement.

The program allows for a stepped-up basis depending on the holding period. A 5-year hold will grant the investment a 10% stepped up basis. A 7-year hold grants the investment an additional 5% of stepped up basis, totaling 15% on the original basis. Finally, after 10 years, investors permanently avoid any capital gains tax on any gains from the opportunity zone fund investment.

Investors have 180 days to invest realized capital gains.

No. You can take receipt of the gains, as long as you reinvest within 180 days. As an Opportunity Fund we have to certify with the IRS. You receive a tax statement at the end of the year.

In part. The original taxes are deferred until December 31, 2026 (or the date of a sale, whichever is earlier). Investors will have to recognize a portion of the deferred gains that year. Investors may benefit from the step up in basis at years 5 (10%) and 7 (another 5%) if they reach either holding period before December 31, 2026.

Opportunity zones are currently being designated by the governors of each state. Each state may designate 25% of the eligible census tracts in their state. As of right now, all 50 states and Puerto Rico have submitted and have been approved for designated Opportunity Zones.

No. Opportunity zones must meet certain criteria to qualify. Census tracts with over 20% poverty and median family income no greater than 80% of the area medium will qualify. There are also contiguous zones, which are census tracts that are adjacent to a designated opportunity zone, and also do not exceed 125% of the median family income of that same opportunity zone.

New monies can be invested in an opportunity fund, however the investor would not enjoy the same tax benefits as realized capital gains. In the case of Sikari Inc, an investor can put new money in to Sikari, and follow under IRS Section 1202 for a tax free gain after a 5 year initial holding period.

These investments carry the same market risk that comes with most real estate investments. The funds 10-year investment period mean a greater chance of the investment living through a market cycle; while at the same time providing the manager with flexibility to maneuver different market fluctuations. However, the historical rate of appreciation is 7.3% Nationally over the last 100 years. Given a longer term outlook the stand alone value of the property in theory will naturally increase over time.