Opportunity Zones in Ohio: What You Need to Know
Ohio, as the seventh largest state in the U.S., contains many extremely promising areas for Opportunity Zones investing, and, as there are a substantial 320 Opportunity Zones distributed througout the state, investors have quite a few areas to chose from. Today, Ohio is known for industries including fuel cell and solar energy development, medical research, aerospace and defense, rubber and industrial products, and tech research and development, which are all contributing to the state’s healthy rate of economic development.
Opportunity Zones in Florida: What You Need to Know
In 2018, Governor Rick Scott announced the designation of 427 Qualified Opportunity Zones (QOZs) througout the state of Florida. These O-Zones are spread througout the state, however, they are concentrated in some of the state’s most populous areas; 68 Opportunity Zones are in the state’s most heavily populated county, Miami-Dade, while 34 Opportunity Zones are located in Duval County, home of Jacksonville, Florida’s most populous city. There are approximately 350,000 commercial properties located inside the state’s O-Zones, about 12% of all commercial properties in the state.
Can the New Markets Tax Credit (NMTC) Program Be Used in Opportunity Zones?
The New Markets Tax Credit (NMTC) encourages investment and development in low income communities by offering tax credits to investors who make equity investments in specialized investment vehicles referred to as Community Development Entities (CDEs). Investors can claim a 39% credit (of equity invested) over a 7-year period. The NMTC program has helped create 178 million sq. ft. of commercial space and has financed more than 5,000 businesses. In comparison, the Opportunity Zones program allows investors to defer or reduce their capital gains taxes by investing in an Opportunity Fund, a specialized investment vehicle that has invested 90% of its assets into a Qualified Opportunity Zone (QOZ), one of 8,700 low-income census tracts througout the U.S.
Can The LIHTC Program Be Used in Opportunity Zones?
The Low Income Housing Tax Credit (LIHTC) program is the federal government’s primary incentive program to encourage investors and developers to create more affordable housing around the U.S. To do so, the program offers investors in affordable housing a dollar-for-dollar reduction on their federal income taxes. In contrast, Opportunity Zones program allows investors who put sell their investments and re-invest their money into qualified Opportunity Funds to defer their capital gains taxes until 2026, and, if they keep their money in the fund for at last 10 years, they pay no capital gains taxes on any new gains that their investment makes.