Opportunity Zones: A Remarkable Opportunity

28.06.2018 | ZAG-S&W's New York Office

The 2017 Tax Act introduced a bevy of major changes to federal income tax law, but perhaps the most remarkable and daring new concept of all is “Opportunity Zones” — a new community investment tool designed to stimulate investment, through tax incentives, in low income communities throughout the nation.

The tax incentives are flat out compelling: A taxpayer who reinvests gain from a sale of property into a “Qualified Opportunity Fund” enjoys the following benefits:

  1. Deferral: Gain reinvested in a Fund is deferred until the earlier of the date the taxpayer sells his interest in the Fund or December 31, 2026.
  2. Capital Gain Reduction: If the taxpayer invests in the Fund for at least 5 years, 10% of the original gain is excluded; if the investment lasts for at least 7 years, an additional 5% (for a total of 15%) of the original gain is excluded.
  3. Appreciation Exclusion: Best of all, if a taxpayer invests in a Fund for at least 10 years, all appreciation in that investment will be tax free on exit from the Fund.

This interactive panel discussion will provide a comprehensive look at the new legislation and will investigate its potential application to a variety of practical and exciting business situations. You will hear from practitioners and experienced real estate operators as to the implementation of this new area.

Topics addressed will include the following:

  • What is an Opportunity Fund, and how do you set one up?
  • Where are the “Opportunity Zones?”
  • Structuring transactions to comply with the legislation
  • Explanation of the tax benefits
  • How do businesses qualify to accept tax-advantaged investments from a Fund?
  • Much more


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