Clearing Up Confusion with Opportunity Zone Investments
February 25, 2019 | Betsy Kim | GlobeSt.com
The opportunity zone legislation was introduced in October as part of a hastened process to pass the 2017 Tax Cuts and Jobs Act in December. Approximately six months were given to certify the zones eligible for the program. Resulting uncertainties have left investors waiting for regulatory guidance. James R. Brockway, a partner in the private client and tax team at the global law firm Withersworldwide, discusses with GlobeSt.com a few key areas where he anticipates further directions based on the IRS public hearing on February 14.
The real estate industry and businesses see a tremendous opportunity to develop low-income areas. But some representatives of low-income housing and neighborhood communities are wary of gentrification and concerned that the program is “a boondoggle for the millionaires and billionaires who want to roll over their gains,” states Brockway.
He describes the regulations as a very low key, relaxed reporting system that is done by self-certification. “There is very little data being gathered to see whether or not the intended reasons for the program’s creation are being satisfied,” Brockway says.