Clients Defer Capital Gains With Incentivized Investments In Low-Income Communities Using Opportunity Zones
Opportunity Zones were established by the 2017 Tax Cuts and Jobs Act (TCJA) to incentivize investment in low-income communities as defined by tax code Sections 45D(e). The new law provides specific details related to capital gains for investments in Opportunity Zones, including deferral and forgiveness of potential future gains. These are generally based on the original investment date and the amount of time the investment is held.
Tax incentives were established to encourage investing in Opportunity Zones. Each of the Opportunity Zones were nominated by the Governors of all 50 states and each of the territories in the United States as well as Washington, D.C. by March, 2018. In Florida, there are several identified opportunity zones in the Jacksonville and North Florida region and beyond.
Should I defer capital gains through a 1031 Exchange or an Opportunity Zone?
There are significant differences between deferring capital gains through a 1031 Exchange vs. an Opportunity Zone. There are also specific criteria required to invest in Opportunity Zones. Understanding these respective differences and criteria needed to receive the best capital gains and tax outcome, is an area that Riverplace Capital has studied and can assist you with as you plan your investing strategy.
Riverplace Capital experts understand the structure required for a purchasing both Qualified Opportunity Zone Property and Qualified Opportunity Zone Business. We can guide you on the nuances related to these investments and connect you with key resources for your decision-making process.
If you want to learn more about Opportunity Zones, or think you may be interested in investing in a business in an Opportunity Zone, we can help.
*Riverplace Capital is not a CPA or Tax Law firm; for specific tax advice consult your CPA or Tax Attorney.