|Included in the Tax Cuts and Jobs Act, signed into law in December 2017, is a new tax planning technique for deferring gains from sales. By investing in Qualified Opportunity Funds, taxpayers can defer (and potentially partially avoid) gain recognition on the sale of any property. The Qualified Opportunity Funds are designed to make investments in economically distressed communities called Opportunity Zones.
What is an Opportunity Zone?
An Opportunity Zone is an economically distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment[i].
Each state can designate up to 25% of its low-income communities as Qualified Opportunity Zones, and the IRS then must approve the designations. The IRS has an interactive map showing all of the Qualified Opportunity Zones that have been approved. You may need to click on the layers tab and uncheck 2011-2015 LIC Census Tract.
[i] From IRS Opportunity Zones Frequently Asked Questions – first question