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Official form guide
Form 8997: Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments
IRS Form 8997 is the Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments. It reports deferred gains, inclusion events, and basis adjustments, such as a 10% increase after a 5‑year holding period.
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IRS Form 8997 - Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments
IRS Form 8997 is the Initial and Annual Statement of Qualified Opportunity Fund (QOF) Investments. It reports deferred gains, inclusion events, and basis adjustments, such as a 10% increase after a 5‑year holding period.
Risk Radar
Scan points- 1Failing to waive treaty benefits when you are a foreign eligible taxpayer.
- 2Not checking the “Yes” box to waive treaty benefits if you are a foreign eligible taxpayer.
- 3Reporting deferred gain in Part II after answering “No” to the foreign eligible question.
- 4Omitting the special gain code “F” in column (d) for each QOF investment.
- 5Leaving out the taxpayer name, TIN, or transfer date in column (c) for acquisitions or dispositions.
Plain English
Form 8997 tells the IRS how much gain you have postponed by putting money into a qualified opportunity fund, any events that end the deferral, and any extra basis you may claim. It also asks foreign taxpayers if they waive treaty benefits.
Submission Date
- Filing date: 2025-12-30 12:29:28
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when an eligible taxpayer holds a QOF investment at any point during the tax year and must report the investment and deferred gains.
- Do not use it when you do not hold any QOF investment during the tax year.
- Check Form 8949 instead when you need to report the deferred gain on the QOF investment.
Form selector
Use this form or another form?
Reporting QOF investment on individual income tax return
Form 8997 must be attached to the individual’s return to disclose QOF holdings
✓ Confirm the return is the correct filing year and includes the attachment
Reporting QOF investment on partnership return
Form 8997 must be attached to the partnership return to disclose QOF holdings
✓ Verify the partnership’s TIN matches the Form 8997
Reporting deferred gain details
Deferred gains from QOF investments are reported on Form 8949 as instructed
✓ Ensure the gain amounts match those entered on Form 8997
Deadline or filing window
Not stated in the official source.
Checklist
What you need before filling it out
Part I Total QOF Investment Holdings Due to Deferrals Prior to Beginning of Tax Year
Totals of QOF holdings at start of year · Form 8997 Part I
Special gain code
Code indicating source of deferred gain (e.g., SGC, A, B…) · Part IV column (d)
Date QOF investment acquired
Acquisition date (MM/DD/YYYY) · Part IV column (b)
Amount of short-term deferred gain invested in QOF
Short‑term deferred gain amount · Part IV column (e)
Waiver of Treaty Benefits on Future Inclusions
Answer Yes/No to waiver question · Waiver question in Part I
Before you submit
- 1Verify you are an eligible taxpayer holding a QOF investment during the tax year.
- 2Confirm all required fields in Part I are completed, including total QOF holdings.
- 3Enter totals from columns (e) and (f) as instructed.
- 4Answer the foreign eligible taxpayer question accurately.
- 5Indicate treaty benefit waiver response if applicable.
- 6Complete Part IV entries for each QOF investment (EIN, acquisition date, description, special gain code, short‑ and long‑term deferred gains).
- 7Attach any required explanations for changes from prior‑year holdings.
- 8Ensure the form is attached to the appropriate tax return (e.g., Form 1040, Form 1065, etc.).
- 9Sign the form (if a signature line is present) before filing.
- 10Retain a copy of the completed Form 8997 for your records.
- 11File the return by the taxpayer’s filing deadline, including extensions.
- 12Obtain acceptance confirmation from the IRS (electronic acknowledgment or mailed receipt).
How to file this form
- 1Gather all QOF investment data and supporting documentation.
- 2Complete Form 8997 with required totals and investment details.
- 3Attach Form 8997 to the appropriate federal income tax return.
- 4File the return (electronically or by mail) and retain the IRS acceptance notice as proof of filing.
Known limitations
- 1The form does not apply to non‑eligible taxpayers.
- 2Non‑qualifying investments in an entity certified as a QOF are not reported on Form 8997.
- 3Deferral elections cannot be reported on Form 8997 for gains not invested in a QOF.
Field map
Compact field-by-field guide
Entity Info
1 items
Name and taxpayer ID of the entity claiming the credit.
Credit Info
1 items
Type of credit or incentive being claimed.
Calculation
2 items
The base amount used to calculate the credit.
Calculated credit amount after applying formulas and limitations.
Certification
1 items
Detailed breakdown supporting the credit calculation.
Signatures
1 items
Sign and date the form.
Almost done reviewing the fields?
Fillable formOpen in Editor->Form 8997 (2025) shows a revision date of 12/23/25 and directs users to www.irs.gov/Form8997 for the latest information. The latest edition adds basis‑adjustment rules of 10% after a 5‑year holding period and 15% after a 7‑year holding period.
What changed or needs a fresh check
- Edition date — confirm the form shows Created 12/23/25
- Fee — Not stated in the official source
- Mailing address — Not stated in the official source
- Signature — Not stated in the official source
Quick Facts
Downloads
After you file
- 1Keep a copy of Form 8997 with the tax return for at least three years.
- 2Retain supporting documentation of QOF investments and deferred gains.
- 3Monitor IRS acknowledgment or acceptance notice for the filed return.
- 4If an error is discovered, file an amended return with a corrected Form 8997.
- 5Update records for basis adjustments after 5‑year and 7‑year holding periods.
- 6Expect any basis‑adjustment notifications in subsequent year filings.
Sources
- SRCForm p.1 — Form 8997 (2025) Created 12/23/25 indicates edition date.
- SRCForm p.1 — attachment instruction points to www.irs.gov/Form8997 for latest information.
- SRCForm p.1 — Who Must File section defines eligible taxpayer requirement.
- SRCForm p.2 — Part IV columns (e) and (f) require totals of short‑term and long‑term deferred gains.
- SRCForm p.1 — Waiver of Treaty Benefits question appears for foreign eligible taxpayers.
- SRCForm p.3 — Basis adjustment details for 5‑year (10%) and 7‑year (15%) holdings.
- SRCForm p.1 — Attachment Sequence No. 997 listed.
- SRCForm p.3 — Special gain code definitions listed.
- SRCForm p.1 — Attach to Form 1040, 1040‑SR, 1040‑NR, 1041, 1065, 1120, etc.
- SRCForm p.3 — Definition of QOF and investment requirements.
Common confusion points
Do I need to file Form 8997 if I sold all QOF investments?
Filers may think a sale eliminates the filing requirement.
→ Verify whether any QOF holdings existed at the beginning or end of the tax year.
What is the correct special gain code to use?
Multiple codes (A‑G, H) are listed, causing uncertainty.
→ Match the code to the source of the deferred gain per the instructions.
Should short‑term and long‑term deferred gains be reported separately?
Columns (e) and (f) can be confused.
→ Place short‑term amounts in column (e) and long‑term amounts in column (f).
Do I have to waive treaty benefits if I’m not a foreign taxpayer?
The waiver question appears for foreign eligible taxpayers only.
→ Answer No and skip the waiver question if you are not a foreign eligible taxpayer.
Is the basis adjustment applied automatically?
The 5‑year and 7‑year adjustments are described but not auto‑applied.
→ Confirm your holding period and calculate the adjustment manually for inclusion in Part III.
Can I use Form 8997 for a partnership that is itself a QOF?
Filers may think the form reports the QOF’s own status.
→ Report only the partnership’s investments in other QOFs, not its own QOF classification.
Workflow map
Related forms and next steps
Before
Current
After
Often used with
⚠ If something goes wrong
- Form 1040‑X — file an amended return to correct Form 8997 errors
Questions about IRS Form 8997
What is IRS Form 8997 used for?
Form 8997 tells the IRS how much gain you have postponed by putting money into a qualified opportunity fund, any events that end the deferral, and any extra basis you may claim. It also asks foreign taxpayers if they waive treaty benefits.
Who must file IRS Form 8997?
Taxpayers who have invested in a qualified opportunity fund—including individuals, corporations, estates and trusts—must file Form 8997. A foreign eligible taxpayer includes anyone filing Form 1040‑NR, a foreign corporation, or a foreign estate or trust.
What information does IRS Form 8997 require?
The form collects totals of deferred gains in Part II, details of inclusion events in Part III, and any uninvested deferred gain as of December 31, 2025 in Part IV, using columns (a)‑(d) and special gain code “F”.
How do I complete IRS Form 8997?
First, answer whether you are a foreign eligible taxpayer and, if so, check the waiver of treaty benefits box. Then complete Part II by listing each QOF investment and the deferred capital gain, entering columns (a)‑(d) and totals in (e) or (f). Use Part III to report any inclusion events, again filling columns (a)‑(c). In Part IV, report any deferred gain not invested as of December 31, 2025, completing columns (a)‑(d). Attach continuation sheets if more investments than lines provided, and transfer totals to the appropriate columns.
Do I need to file Form 8997 if I sold all QOF investments?
Filers may think a sale eliminates the filing requirement. Verify whether any QOF holdings existed at the beginning or end of the tax year.
What is the correct special gain code to use?
Multiple codes (A‑G, H) are listed, causing uncertainty. Match the code to the source of the deferred gain per the instructions.
Should short‑term and long‑term deferred gains be reported separately?
Columns (e) and (f) can be confused. Place short‑term amounts in column (e) and long‑term amounts in column (f).
Do I have to waive treaty benefits if I’m not a foreign taxpayer?
The waiver question appears for foreign eligible taxpayers only. Answer No and skip the waiver question if you are not a foreign eligible taxpayer.
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