What are Opportunity Zones?

Created as part of the 2017 Federal Tax Bill, Opportunity Zones are a new economic development tool that allows individuals and corporations with capital gains tax liability to place those gains in a qualified Opportunity Fund in exchange for tax deferral, tax reduction, and permanent exclusion benefits.

Opportunity Zones

Designated census tracts that are eligible for Opportunity Fund Investments.

Opportunity Funds

The formal investment vehicle for investing in designated Opportunity Zones.

Eligible Investments

• Qualified Opportunity Zone Business Property (new real estate construction, existing property redevelopment, tangible business assets)
• Partnership Interest
• Newly Issued Stock

The Benefits

• Temporary Deferral: If the capital gains are placed into a qualified Opportunity Fund within 180 days, those gains are eligible for tax deferral until the sooner of the sale of the investment asset or December 31, 2026
• Tax Reduction: If the capital gains are held in the Opportunity Fund for 5 years, the basis of the gain is increased 10% at the time of tax payment. If the capital gains are held in the Fund for 7 years, the basis of the gain is increased 15% at the time of the tax payment.
• Permanent Exclusion: There will be no applicable tax on the appreciation of the asset if the investment is held for at least 10 years.