For accredited investors with eligible capital gains, investing through a Qualified Opportunity Fund (QOF) may provide federal tax advantages while offering access to long-term investment opportunities.
Qualified Opportunity Zones
TAX AWARE INVESTMENT OPPORTUNITIES
Qualified Opportunity Zones (QOZs) are federally designated areas created to encourage private investment, economic development, and job creation.
WHAT IS A …
Quailified Opportunity Zone?
A Qualified Opportunity Zone is a designated community where qualifying investments may receive preferential federal tax treatment.
Investors generally access these benefits through a Qualified Opportunity Fund, which invests in qualifying businesses, new development, or substantially improved property located within Opportunity Zones.
Simply owning property inside an Opportunity Zone does not automatically qualify an investment for QOZ tax benefits.
EXAMPLES
Potential QOZ Investments
REAL ESTATE
New development and qualifying redevelopment
BUSINESSES
Qualifying operating businesses within designated zones
ALTERNATIVE ASSETS
Certain qualifying energy and other investment strategies
POTENTIAL BENEFITS
Why Investors Explore QOZ
Capital Gains Deferral
Eligible capital gains reinvested through a Qualified Opportunity Fund may qualify for temporary federal tax deferral, subject to applicable requirements
Potential Basis Increase
Under the post-2026 framework, qualifying investments held for at least five years may receive a 10% basis increase, with qualifying rural Opportunity Fund investments potentially eligible for a 30% increase
Long-Term Tax Treatment
After satisfying applicable 10-year holding requirements, eligible appreciation generated by a qualifying QOF investment may potentially be excluded from federal capital gains tax
IMPORTANT INVESTOR CONSIDERATIONS
Holding Periods
Tax & Regulatory Complexity
Limited Liquidity
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