About the program:
- The Opportunity Zone Program aims to foster economic development and job creation in economically distressed communities. It was created by the Federal Tax Cuts and Jobs Act of 2017 to encourage businesses, developers and financial institutions to invest long-term capital in low-income census tract areas. These areas were designated as Qualified Opportunity Zones by the U.S. Department of Treasury in June 2018. Treasury has approved 8,760 Qualified Opportunity Zones, which are in all 50 states, five territories and the District of Columbia.
- Investments are made in Opportunity Zones through U.S. Treasury Qualified Opportunity Zone Funds, which must invest over 90 percent of their assets in Qualified Opportunity Zone properties and businesses. Qualified Opportunity Zone Funds attract investors through possible tax benefits. Tax benefits can accrue once unrealized capital gains from other investments are rolled into Qualified Opportunity Zone Funds. Benefits include the following:
- Taxes are deferred on capital gains rolled into Qualified Opportunity Zone Funds and the original tax bill through December 31, 2026 or the sale of the Opportunity Zone investment, whichever is earlier;
- Taxes are reduced on capital gains held in Qualified Opportunity Zone Funds for certain lengths of time; for investments held for 5-years, the cost basis for tax purposes is increased by 10% and for investments held for 7 years, the cost basis increases an additional 5%;
- The rolled over capital gain appreciates tax-free if the investment in the Qualified Opportunity Zone Fund is held for 10 years or longer.
Link to GIS Hub with Opportunity Zone layer: Planning and Zoning Web GIS Application (arcgis.com)