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Opportunity zones: An innovative investment vehicle created by the Tax Cuts and Jobs Act

Source: taxprotoday.com - Jun 8, 2018

The Tax Cuts and Jobs Act created a section of the tax code that allows taxpayers to take advantage of a new investment vehicle called Opportunity Funds. The purpose of this new investment vehicle is to help direct resources to low-income communities, known as Qualified Opportunity Zones, through a more market driven approach.

Investing in Opportunity Funds can provide the following three tax incentives to investors: (1) deferral of capital gain, (2) possible reduction of the amount of gain realized through a basis adjustment, and (3) possible permanent exclusion of gain on the appreciation for the interest in a Qualified Opportunity Fund. Furthermore, there is no cap on the amount of money that can be invested in Qualified Opportunity Funds.

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Category: General Business