What is the Opportunity Zones Program?
As part of the Tax Cuts and Jobs Act (TCJA) of 2017, the Opportunity Zones program was created to increase investment in economically distressed communities.
Opportunity Zones are designed to spur economic development by providing tax benefits to investors.
The program provides tax incentives to funds that invest in historically distressed neighborhoods throughout the U.S. and investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026.
The program provides preferential capital gains treatment for investments within designated low-income census tracts.
An Opportunity Fund may be organized as a corporation or partnership whose assets comprise at least 90% qualified Opportunity Zone assets, representing investment in Opportunity Zones
Investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026.
If the QOF investment is held for longer than 5 years there is a 10% exclusion of the deferred gain. Hold the investment in the fund for more than 7 years, the 10% becomes 15%. If the investor holds the investment in the Opportunity Fund for at least ten years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.
How Many Communities Qualify for the Program?
There are over 8,700 communities in all 50 states, the District of Columbia, Puerto Rico, and four other U.S. territories that are designated as Opportunity Zones.
How Can I Find Out if My Property Qualifies for the Opportunity Zone?
Our designated team of Real Estate Concierges are knowledgeable about Opportunity Zones and how to determine if a property qualifies within a certain zone. We've also developed a network of professionals (CPAs, accountants, tax attorneys, developers, QOFs, real estate professionals, etc.) throughout the U.S., to help stay informed and provide updated information to our customers.
So before you purchase an investment property or sell your own, let us assist you through the entire process and help you benefit from the Opportunity Zones.
Consultant & Training Services
Learn the basics about Opportunity Zones and how your business or organization can take part in this industry. Call today to schedule an appointment and inquire about our training fees.