SECTION 4. ELECTION PROCEDURE

.01 Time for Making the Election. A § 1397B election must be made by the due date (including extensions) of the tax return for the taxable year in which a QEZ asset is sold.

.02 Manner of Making the Election . (1) In general. Except as provided in section 4.02(2) of this revenue procedure, the election is made by:

(a) reporting the entire gain realized from the sale of the QEZ asset on the applicable line of Form 4797, Sales of Busi- ness Property, or Schedule D, Capital Gains and Losses, as appropriate, of the return; and

(b) on line 2 of Form 4797, or the line directly below the line on Schedule D on which the gain is reported, entering in column (a) “Section 1397B Rollover”, and on the same line, entering as a loss in column (g) of Form 4797 or column (f) of Schedule D, as appropriate, the amount of the gain deferred under § 1397B.

(2) Transition rule. If the gain from the sale of a QEZ asset is reported on a timely filed return before October 7, 2002, and includes an affirmative statement to the effect that a § 1397B election applies to the gain, the requirements of section 4.02(1) of this revenue procedure will be treated as satisfied so that it will not be necessary to file an amended return to make the § 1397B election. Otherwise, an amended return satisfying the requirements of section 4.02(1) of this revenue procedure must be filed in order to make the § 1397B election with re

26 CFR 601.105: Examination of returns and

claims for refund, credit or abatement; determina-

tion of correct tax liability.

(Also Part I, § 1397B.)

Rev. Proc. 2002–62