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Level 2
March 28, 2019

How to Report Deferred Gain Going into Qualified Opportunity Zone from Gain on 4797

  • March 28, 2019
  • 1 reply
  • 12 views

We had a client sell some real estate at a gain, then they invested a portion of the gain into a Qualified Opportunity Zone Fund.  The gain is reported on page 2 of the 4797, then flows to page 1 of the 4797, then goes to Sch D.  I cannot figure out how to report the deferred gain on the forms.  The only place I see is on Form 8949 with code Z.  But the 4797 does not go to Form 8949.  But the instructions to 4797 say to use 8949 to report the deferred gain.  But then the instructions for 8949 say that 4797 gains go directly to Sch D.  For now, we've added another line item on page 1 of the 4797 showing a loss for the amount of the deferred gain that was invested, as an offset to the real estate gain.  I would imagine there would be a more formal way of reporting this, especially since the deferred gain needs to be tracked for many years in order to determine the reduction in future years.  Any help would be appreciated.  Thanks.

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1 reply

IntuitCharlene
Community Manager
March 28, 2019

To enter the Deferred Gain it actually requires two transactions to be entered. This article gives you details for Lacerte on how to enter those to get it to work out correctly: 

 

https://accountants-community.intuit.com/articles/1801290-rollover-to-qualified-opportunity-fund 

 

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Eric11_2Author
Level 2
March 28, 2019

That'll work.  Thanks!  As a side note, the people I talked to at Lacerte customer support had never even heard of the Qualified Opportunity Zones.  This information needs to be spread to the phone support people.  Thanks for your help.

IntuitCharlene
Community Manager
March 28, 2019

I'm glad to help! I'll make sure our phone teams are aware of this. 

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Accept as solution" and then just changing the Accept as solution to Mark as Best Answer, mine gets cutoff, so it is too long. I changed mine to the following and it fits. -->**Say "Thanks" by clicking the thumb icon in a post**Click "Mark as Best Answer " to mark the post that answers your question.