Investar USA: Is There Opportunity in Opportunity Zones?

Are you looking to take your real estate investing venture to another level? Or, are you simply trying to get your real estate business on the map? It may be worth your while to look into the opportunities that come with Opportunity Zones, which are capturing the attention of many investors in United States today, according to Investar USA. Let’s take a look at what these zones are and how you can take advantage of them.

The purpose of Qualified Opportunity Zones is to encourage investment, development and job creation in economically distressed communities.

The Opportunity Zone designation is spelled out in the Tax Cuts and Jobs Act from 2017. Since this law passed, you can find Opportunity Zones in all areas of the United States. In fact, there are over 8,700 of these zones in America.

If you choose to invest in an opportunity zone, you must agree to follow the rules associated with investing in these qualified zones. But don’t worry -- your willingness to comply with these rules will yield some rewards. Specifically, you’ll be able to take advantage of major incentives related to the capital gains tax both immediately and long term.

Whenever you divest real estate, you generally have to pay capital gains tax on your earnings. However, if you divest a property in an opportunity zone and then place this capital gains in an Opportunity Fund, you can reduce and defer your tax liability associated with that gain. In addition, you don’t have to pay taxes on any appreciation you earn in the future through this fund.

Thanks to these incentives, you save money at tax time when you become an Opportunity Fund investor. For this reason, investing in Opportunity Zones may be one of the smartest financial moves you can make this year and in the years ahead.