More Opportunity Zones/Funds Clarification

[Account Closed]

I have been searching and reading prior threads, but thought I'd go ahead and start a new thread since there has been time for people to learn more about opportunity zones, rather than have to sort through a bunch of older posts.  I hope that's okay.

I've been reading up on opportunity zones the last few days, and found this IRS publication where they're trying to clarify the rules: https://www.irs.gov/pub/irs-drop/reg-115420-18.pdf

I still find it confusing.  I'm trying to grasp the 90% rule.  I'm hoping some of you knowledgeable people will help me analyze a specific example.

Let's say I set up an S corporation, with only myself, so I have the proper type of entity without partners.

I sell a property and have $20,000 subject to capital gains tax after the sale.

I then create a QOF (qualified opportunity fund) with the $20,000.

I want to buy a property in a QOZ (qualified opportunity zone) and hold it for 10 years.

I know I have to spend an equal amount on the property and in refurbishing it.

So, if I want to buy a $50,000 property and put $50,000 in repairs and upgrades to it, can I do this and be able to get the benefits of the QOZ?

It looks like the rules are saying that the $100,000 I'd put into the property would have to be 90% subject to capital gains, so I'd have to actually have $90,000 in capital gains, and my $20,000 wouldn't qualify me.

On the other hand, one example used in that document I linked to mentioned a partnership borrowing money and the borrowed money didn't count toward the 90% rule - unless it's only talking about working capital, which has shorter limits, etc.  I'm unclear about this.

Can someone explain to me what I could do in the above scenario?  What would my options be?  Unfortunately, other than clarifying that pass-through corporations, such as an S corporation are allowed, there weren't examples for a single S corporation without partners buying real estate.

I did see that you only have to double the value of the building and not the land, so there would be a bit of a break there.  But, mostly, I'm trying to understand the overall numbers that qualify for the 90% rule.

Thanks!