As Investors search for places to shelter their real estate gains, the federal government has issued guidance regarding Qualified Opportunity Zones (QOZ). If you invest in these zones now , in 10 years you may be able to defer capital gains taxes. Qualified Opportunity Zones were established with the Tax Cuts and Jobs Act in late 2017 to attract investments and jump-start economic growth in disadvantaged (based on census data) urban, suburban and rural areas throughout the country.
The government allows any participating investor to defer paying tax on capital gains from the sale of property in these areas if those gains are invested in a qualified opportunity fund. That fund, in turn, must invest 90 percent of its assets in businesses or property used in one of these designated low-income communities.
Depending on the holding period, eligible capital gains from investments in a qualified opportunity fund can avoid tax on up to 15 percent of the original gain and defer tax on the remaining original gain until the sale of the fund or the end of 2026
Coni Rathbone local real estate attorney and expert in these Zones will deliver a primer on Opportunity Zones and how they are changing investment in real estate.
She will compare QOZ investments to 1031 Exchanges, and how both are ways to defer the taxes on capital gains. They are very different in their application, as QOZ investments have very different time period restrictions, are not limited to real property only. You will not want to miss this presentation as Coni will be able to update you with the latest clarifications to this unique investment opportunity.