Opportunity Zones

Opportunity Zones are powerful tax incentives for accredited investors created by the Federal Government to stimulate economic investment in specific geographic areas. If you have the knowledge, taking advantage of this program can be as easy as writing a check to a fund and filling out a short tax form.

The Opportunity Zone tax framework represents the biggest economic development program in U.S. history.  It provides Federal and State tax incentives for investors to re-invest their capital gains into businesses and real estate in designated low-income communities. The goal is for these zones to stimulate economic growth and job creation in these areas.

So far, the program has been a big success. More than $2.3B in capital gains have been re-invested into Opportunity Zones, and this has led to the creation of thousands of jobs. The Investing in Opportunity Act is the legislation that defines the Opportunity Zones tax incentive via Internal Revenue Code Section 1400Z. The United States Congress designed the policy to redirect private capital into under-invested, economically distressed communities. Zones were then nominated by state governors and certified by the U.S. Treasury as Qualified Opportunity Zones.

Any accredited investor subject to capital gains as the result of an asset sale can take advantage of the tax incentives tied to a Qualified Opportunity Zone Fund. The investment must be made within 180 days of the recognition date. 

The capital gains obligation can come from any type of asset sale — typically real estate; publicly traded securities such as stocks, bonds, mutual funds, ETFs; the sale of a privately held business; collectibles; or crypto assets, including Bitcoin. 

Taxpayers who rollover their capital gains into a Qualified Opportunity Fund can benefit from three tax benefits — deferral, reduction, and exclusion. 

To receive further information on Opportunity Zones, fill out a brief form.

Special credit to: OZDB & Bader Martin