Opportunity Zones

The Tax Cuts and Jobs Act of 2017 created a new program that incentivizes investment in selected development areas by eliminating capital gains taxes after a 10-year hold period. The program is widely viewed as the most substantial development incentive created over the past few decades by the federal government and particularly favors investments in ground-up real estate development and redevelopment.


8,700+

Census tracts designated as QOZs
(out of 74,000)

Over 35 million

Population in QOZ census tract

76%

Metropolitan
Areas

24%

Rural
Areas

$44.7K

Median
Income

18%

Bachelor
Degree

56%

Rent
Burden

8,700+

Census tracts designated as QOZs
(out of 74,000)

Over 35 million

Population in QOZ census tract

76%

Metropolitan
Areas

24%

Rural
Areas

$44.7K

Median
Income

18%

Bachelor
Degree

56%

Rent
Burden

The Tax Cuts and Jobs Act of 2017 created a new program that incentivizes investment in selected development areas by eliminating capital gains taxes after a 10-year hold period. The program is widely viewed as the most substantial development incentive created over the past few decades by the federal government and particularly favors investments in ground-up real estate development and redevelopment.


Who is eligible to invest in
an opportunity zone?

Opportunity Zone
benefits

Types of gains eligible for
opportunity zone benefits

Who is eligible to invest in an Opportunity Zone?

Eligible investors include anyone with recognizes capital gains for the purpose of Federal Income Tax:

Individuals
including
foreigners with
US Tax returns

Family Offices, Trusts & Estates

Corporations:
C Corps
S Corps

REITs

Partnerships

Opportunity Zone
Benefits

DEFER

The payment of capital
gains tax on almost any
asset sale until 2026

REDUCE

Tax on deferred gains
reduced by 10% after
5-years

ELIMINATE

Tax on gains in the new
QOZ investments after
10 years

STATE TAX
AND INCENTIVES

Deferral and Forgiveness of
Capital Gains Tax in Certain
States

State and municipal
development incentives

Types of gains eligible for
Opportunity Zone benefits

Nearly any kind of capital gain can be rolled over into an Opportunity Zone Investment. Gross gains are eligible; no need to net losses. Capital gains need to be invested in a QOZ Fund within 180 days of the sale (or the taxable year end of the partnership in case of K-1's.

STOCKS AND BONDS

Short and
long-term capital
gains on stocks,
bonds and options

STOCK OPTIONS

Exercise of
employee stock
options or vesting
of restricted stock

REAL ESTATE

Gain from
disposition of real
estate, including
personal residence

BUSINESS SALE

Gain on sale of
a business

PARTERNSHIP
K-1s

Gain allocated from
a partnership on a
K-1

OTHER
ASSET SALE

Sale of other
property (e.g. art,
bitcoin)