Opportunity Zones were put into place along with Trump’s Tax Cuts & Jobs Act of 2017. They are a wonderful way to proactively combat some of the harm and negativity that has gone on in the world this year and other years by investing in increasing property value where it is really needed: low-income and distressed areas.
In a nutshell; you buy a property for $10,000 and sell it for $20,000. You can pay tax on the $10,000 gain OR you can buy another property in a federally designated distressed area and not pay tax on any gain. Later, when you sell the property, you will pay tax on the gain unless you have held the property for a certain amount of time in which case there is exception allowing you to adjust the basis so you don’t pay any tax at all.
These opportunity zones are a great way to offer an incentive to investors to make a change in their communities and offset some of the risk and expense in areas of the city that aren’t as upgraded or developed.
The IRS is offering this free webinar on September 3rd: https://www.irs.gov/newsroom/thursday-sept-3-irs-webinar-focuses-on-opportunity-zones and if I am not busy doing some taxes, bookkeeping or notary work for you all I will be “attending”.
Let’s make our cities better and save on taxes!
Written by Laura Fleig
August 31, 2020
www.fleigfinancialsllc.com
