Opportunity Zones

opportunity
zones

Unlocking Investment Potential

Understanding Opportunity Zones

In an effort to stimulate economic growth and revitalize underserved communities, the U.S. government introduced Opportunity Zones as part of the Tax Cuts and Jobs Act of 2017. But what exactly are Opportunity Zones and how do they function?

Opportunity Zones?

Opportunity Zones are economically distressed communities designated by each state's governor. These areas typically suffer from a lack of investment and face economic challenges such as high unemployment rates and low median incomes.

How do they Work?

The Opportunity Zone program offers tax incentives to encourage investment in these communities. Investors can defer paying taxes on capital gains by reinvesting those gains into Qualified Opportunity Funds (QOFs), which in turn invest in businesses or properties within Opportunity Zones.

Key Incentives

Tax Deferral

Investors can defer paying taxes on their original capital gains until the earlier of December 31, 2026, or the date they sell or exchange their investment in the Opportunity Fund, a tax incentive program aimed at stimulating investment in economically distressed areas known as Opportunity Zones, established as part of the Tax Cuts and Jobs Act of 2017.

Basis Step-Up

Long-term investors receive additional tax benefits. If the investment is held for at least five years, the investor's basis is increased by 10% of the original gain. If held for at least seven years, the basis is increased by 15% of the original gain. (update: legislation is pending in Congress up for renewal of this basis setup plan in 2025.)

Cap Gains Exclusion

Perhaps the most significant incentive is the potential for a full exemption from additional capital gains taxes on the appreciation of the Opportunity Fund investment. Investors who hold their Opportunity Fund investments for at least ten years are eligible for this exclusion, encouraging long-term commitment to the development of these communities.

Organizing Opportunity Funds:

Opportunity Funds can be structured in various ways to attract a diverse range of investors. They may take the form of partnerships, corporations, or real estate investment trusts (REITs), providing flexibility for investors to participate according to their preferences and financial goals.

Why Invest in Opportunity Zones?

Investing in Opportunity Zones not only offers potential financial returns but also provides an opportunity to make a positive impact on disadvantaged communities. By directing capital towards job creation, infrastructure development, and business growth, investors can contribute to the long-term sustainability and prosperity of these areas.

Partnering with Wingate Law :

Navigating the intricacies of Opportunity Zones and maximizing the associated tax benefits requires expertise and experience. Wingate Law stands out as a leader in this field, offering unparalleled legal counsel and strategic guidance to investors and businesses seeking to capitalize on Opportunity Zone investments. With a dedicated team of professionals and a proven track record of success, Wingate Law is committed to helping clients unlock the full potential of Opportunity Zones while ensuring compliance with regulatory requirements.

Realization:

Opportunity Zones present a unique opportunity for investors to achieve both financial and social objectives. By leveraging tax incentives and supporting community development, investors can play a vital role in transforming distressed areas into thriving economic hubs, with Wingate Law by their side every step of the way.

How it Works & Who its For

Opportunity Zones are designed for investors and businesses seeking to make a meaningful impact while maximizing financial returns. Whether you're an individual investor looking to defer capital gains taxes or a corporation aiming to strategically invest in distressed communities, understanding the intricacies of Opportunity Zones is essential.

Initial Consultation: Schedule a consultation with Wingate Law's experienced team of attorneys specializing in Opportunity Zone investments. During the meeting we will glean information about your investment goals and objectives and answer questions about whether or not an opportunity zone would be a wise investment for you.
Goal Assessment: Work with Wingate Law to assess your investment goals and objectives. Our team will evaluate your financial situation, risk tolerance, and desired impact on the communities you wish to invest in.
Opportunity Zone Identification: Identify potential Opportunity Zones where you plan to invest. Wingate Law can assist in researching and selecting suitable Opportunity Zones based on your investment criteria and objectives.
Due Diligence: Conduct thorough due diligence on investment opportunities within the selected Opportunity Zones. Wingate Law can help analyze potential investments, assess risks, and ensure compliance with Opportunity Zone regulations.
Legal Structuring: Work with Wingate Law to structure Opportunity Funds or investment vehicles tailored to your specific needs and objectives. Our team will provide guidance on legal structuring, tax implications, and regulatory compliance.
Investment Execution: Our attorneys will assist with helping to plan and execute your investment strategy.
Ongoing Compliance: Stay informed about ongoing compliance requirements and regulatory changes related to Opportunity Zone investments. Wingate Law will provide ongoing legal counsel and support to help ensure compliance with all applicable laws and regulations.

By following these steps and partnering with Wingate Law , individuals and businesses can navigate the complexities of Opportunity Zone investments with confidence and expertise. Contact us today to schedule your initial consultation and take the first step towards unlocking the full potential of Opportunity Zones.

Unlocking Opportunity Zones

Tax Credits

Learn how Tax Credits could benefit you during tax season while helping your community.

learn more

Real Estate Development