The $1.5 trillion federal tax cut, titled Opportunity Zones, allows states across the country to incentivize growth in underdeveloped areas and it is potentially one of the nation’s largest economic development programs.
While investors are seeing great opportunities ahead of it, the U.S Treasury Department is expected to release an updated set of rules and regulations on the program in the coming weeks.
Tax Free Capital Gain
If a multifamily developer would invest $20 million in an Opportunity Fund and the investment appreciates to $35 million over a 10-year investment horizon, the $15 million of capital gain would be tax-free to the investor at disposition or sale of the interest.
Opportunity Funds can finance Commercial, Industrial, Multifamily properties, housing, infrastructure, and current or start-up businesses.
If you are interested in purchasing or refinancing Commercial Real Estate please contact me at kelly@kellysorensen.com or (310) 993-9507.
