News
Opportunity Zone
    Tax Deferment, Tax Elimination and Value Enhancement to Specific Properties and Projects
Sean Parker is best known for co-founding Napster, serving as the first President of Facebook, and founding the Economic Innovation Group in Washington, DC, to study ways to encourage entrepreneurs and boost the U.S. economy. He, along with Senators Tim Scott (R-SC) and Cory Booker (D-NJ), drafted the original Opportunity Zone legislation, which was included in the Tax Cuts and Jobs Act of 2017. An estimated $2.2 trillion in unrealized capital gains from profitable investments in stocks and mutual funds sit on the books of individuals and corporations. The Opportunity Zones Program looks to tap this capital for economic growth. Investing capital gain in designated areas or in an Opportunity Zone Fund is the intent of the legislation.

Purpose

Qualified Opportunity Zone Funds are designed to spur economic development by providing tax benefits to investors with capital gains. Invest your capital gains in our Qualified Fund within 180 days of realization of the gain and receive three benefits: 1. tax deferral on the initial capital gain, 2. potential basis step-up on the initial capital gain invested (A step-up in basis is a very good thing), and 3. tax elimination on the QOF investment appreciation.
   
Temporary Deferral of Inclusion in Taxable Income for any Capital Gains Reinvested in an Opportunity Fund. The deferred gain must be recognized on the earlier of the date on which the opportunity zone investment is disposed of or December 31, 2026. You will not be taxed on the gains invested in an Opportunity Fund until you exit the fund or December 31, 2026, whichever comes first.
    
   
A Step-Up in Basis for Capital Gains Reinvested in an Opportunity Fund. The basis is increased by 10% if the investment in the Opportunity Fund is held by the taxpayer for at least 5 years and by an additional 5% if held for at least 7 years, thereby excluding up to 15% of the original gain from taxation. Another way to understand this benefit: Your Capital Gain, invested in our fund, will be taxed at reduced rates – 90% for investments held at least 5 years (10% basis increase) and 85% for investments held at least 7 years (15% basis increase).
    
   
A Permanent Exclusion from Taxable Income of Capital Gains from the Sale or Exchange of an Investment in an Opportunity Fund if the Investment is held for at least 10 Years. This exclusion only applies to gains accrued after an investment in an Opportunity Fund. What this means is Tax-Free Earnings After Year 10 in our fund. If you hold an investment for 10 years in our fund, gains accrued on your Opportunity Fund investment during that 10-year period will not be taxed. It’s a permanent exclusion from taxable income.
    

Captial Gains

    Long Term Capital Gains tax rates are either 0%, 15% or 20% for most assets held for more than a year. Short Term Capital Gains tax rates on most assets held for less than a year follow ordinary income tax brackets (10%, 12%, 22%, 24%, 32%, 35% or 37%).

    Why invest your Capital Gains with us?    

   We have substantial experience in real estate, we already possess projects under development and we have spent time money and effort learning the complexities of the process. Picking successful projects that will appreciate in value and qualify for the OZone enhancements is one of our leading abilities.

We bring investors and projects together. We can review your project or plan to determine if it meets the requirements for Opportunity Zone benefits. Contact us to discuss in more detail. We look forward to talking to you.