Almost three years after the passage of the 2017 Tax Cuts and Jobs Act (TCJA) brought to life the first new community development tax incentive in nearly 20 years, we are still in early stages of understanding how Opportunity Zones (OZs) can and should be implemented.
This Opportunity Zones guide is intended to be a plain-English tutorial on the nuts and bolts of OZ investing – one that goes beyond technical nuances to provide practical tips that can help create and support a healthier OZ ecosystem, shifting economic activity to areas that need it most.
Making a difference in distressed communities, CohnReznick has been on the cutting edge of innovative community development for more than 30 years. Whether working within tax credit programs, helping shape policy at federal and state levels, or collaborating with state and local economic development programs, we have helped lead the growth and sophistication of the community development industry. Since the implementation of tax credits and now through the unique approach of opportunity zones, CohnReznick has served investors, developers, governmental entities, and other stakeholders to help communities reach their full potential.
After a long, challenging year of navigating through emerging regulations and controversy regarding Opportunity Zones, the Treasury released a third – and, for now, final – wave of OZ regulations in December 2019. These changes have far-reaching impact and need to be properly embedded into an organization’s OZ program strategy.
From a guidance perspective, we anticipate no forthcoming changes, which means we may finally be at the end of the beginning. Now we all can focus on moving forward quickly to develop impactful OZ program strategies.
Click below for our early, high-level perspectives on the third wave of regulations, and find deeper analysis and perspective in our OZ guide (see above).
Signed into law through The Tax Cuts and Jobs Act (2017), sections 1400Z-1 and 1400Z-2 in the IRS Code created a new and dynamic community development program, opportunity zones. With trillions of dollars of unrealized capital gains across the U.S., the program provides a tax incentive for investors to re-invest such gains into Qualified Opportunity Funds dedicated to investing in government designated opportunity zones. Stimulating both individual and corporate investment in low-income communities within these zones across the U.S. and in U.S. territories, the expected capital formation and fund management platform created will be significant.
Closely aligned with this community development strategy, CohnReznick currently serves the types of organizations that are accumulating capital and managing the Opportunity Funds being formed. With a long and successful track record of servicing Private Equity, Venture Capital, Hedge Fund and Family Office organizations, we support the bridge between financial services and community development that will help deliver successful opportunity zone investments.Learn how opportunity zones provide tax benefits >
Our Opportunity Zone team includes national tax experts who analyze the details of legislative policy, transaction advisory experts who strategically analyze and model the practical effect of such policy, and experts who handle fund formation, accounting, and compliance. Additionally, our industry experts aligned with the opportunity zone business sectors (investees), such as real estate, renewable energy, hospitality, technology, life sciences, and manufacturing, will help us to ensure that this tax provision has maximum effect for the distressed communities it impacts.
The Guide to Making Opportunity Zones Work
Birth of Opportunity Zones
CRE Insights & Updates
Opportunity Zones: Changing the face
of economic development
Qualified Zone Map:
Visit CohnReznick's Opportunity Zone Mapping Tool
Business of Baseball
Invest in an opportunity zone fund to potentially defer significant capital gains.