St. Louis Lawyers Say Opportunity Zone Investments Just Got Better

By on April 20, 2019

From St. Louis Business Journal:  Opportunity Zones — the federal tax incentive designed to boost investments in poorer communities — have been strengthened by the latest Treasury Department rules issued this week, St. Louis lawyers said.

One of investors’ fears was that the regulations would steer most of the money into real estate development, not startups that could lead to jobs.

That’s not the case. The new guidance offers several paths to qualify for Opportunity Zone tax benefits. For example, even export businesses or online businesses that ship throughout the U.S. or the world could qualify.

Not all of the news was good for investors, including limitations on timing for so-called net 1231 property gains, but overall, the rules “are quite favorable to investors,” lawyers at Polsinelli said in a report.

The Opportunity Zone program was established as part of the Tax Cut and Jobs Act of 2017 and gives investors a way to defer and reduce capital gains. The zones are geographic areas, primarily in economically distressed communities, that qualify for tax incentives for investors in businesses and real estate in the zones. More than 8,700 areas nationwide are certified as qualified opportunity zones.

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