Opportunity Zones are a new investment tool created to generate investment and economic development in designated low-income communities. Enacted into law through the Tax Cuts and Jobs Act of 2017, this federal program allows investors to defer or eliminate taxes on money they’ve made from selling property such as real estate, stocks, or art, and put it into qualified opportunity funds (QOF) that invests it in real estate projects or businesses within a designated Opportunity Zone.
Sacramento County is pleased to have received Opportunity Zone designations on 15 census tracts within the unincorporated area of the County. While the County looks forward to working with investors and other stakeholders on utilizing this tool, this is a federal program, so the County does not have a controlling role in the programs administration. The County’s role is primarily to share information and coordinate assistance. Investments are not administered or overseen by the County. Pursuit of investments are the responsibility of the business and property owners.
Key Benefits of Opportunity Zones
- Deferral of the original capital gains taxes invested in a QOF. Investors can defer their original tax bill until December 31, 2026 at the latest, or until they sell their Opportunity Fund investments, if earlier
- When investments are held for five years, 10% increase in rolled-over federal capital gains basis
- When investments are held for seven years, 15% increase in rolled-over federal capital gains basis
- Opportunity fund investments held in the fund for at least 10 years are not taxed for federal capital gains
- Opportunity to invest in a diversified portfolio of QOF projects throughout the U.S./U.S. Territories, including businesses, property, infrastructure, etc.
- Opportunity to attract investment and financial support for businesses, housing, commercial development, and infrastructure projects within the local community.
If you have any questions or would like additional information about Opportunity Zones, please contact: Linzie Fukushima at firstname.lastname@example.org.