Leverage Law Group is an active participant in this emerging and highly specialized area of tax credit law. Opportunity Zones are low-income communities designated by the state governors and certified by the Department of Treasury as highly distressed areas in need of focused financial incentives to assist in their development and renewal.
The Tax Cuts and Jobs Act of 2017 added a new development incentive program whereby investors could defer payment of tax on certain gains (and qualify for certain reductions in the deferred tax after specified holding periods) by reinvesting those gains in qualified opportunity funds (“Opportunity Funds”). Opportunity Funds are required to use at least 90% of those proceeds to make investments in qualified opportunity zone property. Qualified opportunity zone property can consist of (i) qualified stock or partnership interests in qualified opportunity zone businesses or (ii) qualified opportunity zone business property.
Leverage Law Group is involved in efforts by this new industry to identify and seek guidance and clarifications to unresolved questions and issues in the existing and forthcoming statute, regulations, and other guidance for this new incentive.