By Venroy July
June 12, 2019
The IRS and the Treasury Department recently released a second set of proposed regulations on the federal Opportunity Zone program, which was created by the 2017 tax law to spur investment in economically distressed census tracts.
The Opportunity Zone law provides significant long-term tax benefits for investors who put capital gains into Qualified Opportunity Funds, investment vehicles set up to deploy funds into eligible property and businesses in designated Opportunity Zones.
Most Opportunity Zones are in majority black and brown neighborhoods, giving rise to concerns about risks of gentrification and displacement of low-income families from their neighborhoods if the program does not adequately protect the interests of existing residents. Some worry that struggling communities will continue to be left behind, while outside investors enjoy the rewards of Opportunity Zone tax preferences.