Opportunity Zones

Investment Opportunities

Defined under the 2017 Tax Cuts and Jobs Act, Opportunity Zones are census tracts composed of economically disadvantaged communities. With more than 8,700 Opportunity Zones, this source of untapped capital can revitalize underserved communities while also offering incentives for investors.

When a person reinvests a capital gain into a qualified opportunity fund (QOF), they receive two tax benefits:

Tax deferral: Eligible capital gains invested in a QOF may be deferred from federal taxation, subject to applicable rules and timing requirements.
Potential tax-free appreciation: After holding a qualifying QOF investment for at least 10 years, investors may be able to exclude appreciation on the QOF investment from federal taxable income.

Qualified Opportunity Fund

A tax-advantaged way to put capital gains to work.

A Qualified Opportunity Fund allows investors to defer and potentially reduce capital gains taxes by reinvesting eligible gains into designated Opportunity Zones. For the right investor, it’s a meaningful strategy for turning a taxable event into a long-term, tax-efficient opportunity.

Eligible assets may include stocks, bonds, real estate, collectibles, and partnership interests.
Only capital gains need to be invested in a Qualified Opportunity Fund (QOF); the original investment principal is not required.
Eligible QOF investments may include commercial real estate, housing, infrastructure, and businesses located within a Qualified Opportunity Zone.
Capital gains must generally be invested in a QOF within 180 days to qualify for the applicable tax benefits.
The deferred gain may be deferred until the applicable recognition date, at which point it must be included in taxable income.
QOF investments may provide the potential to enhance after-tax returns through income generation and appreciation.