The Opportunity Zones program offers three tax benefits for investing in Opportunity Zone:

• Deferral of past capital gains,
• Reduction in tax liabilities, and
• Elimination of future capital gains

How does it work?

To meet the requirements for the preferential tax treatment, the investment of the gain must be made in a "Qualified Opportunity Zone Fund" within 180 days of the date of the sale or exchange that generated the gain. The taxpayer can set up its own QOZ fund by forming an LLC or corporation for the purpose of investing in QOZ property, or can invest in an already established QOZF. If forming its own QOZF, the taxpayer will then need to self-certify that it is a QOZF by completing IRS Form 8996.

Where are Opportunity Zones in New Orleans?

There are several Opportunity Zones in the New Orleans area, most notably the Central Business District. For an interactive map showing each zone in Louisiana

 

New Orleans Map Showing Opportunity Zones in Blue

While there appear to be many advantages in investing in QOZFs, many questions still loom for investors, particularly when it comes to investing in businesses as opposed to real estate. While the IRS has provided some guidance to investors, as with most new tax programs, the details have not been finely tuned. Working with Business Law Group, we can position you to take advantage of this new opportunity with eyes wide open as to the possible legal and tax implications to come over the next several years.