Are You Sitting on Unrealized Capital Gains?
Introduced by the Tax Cuts and Jobs Act of 2017 (TCJA), opportunity zones are low-income census tracts, or areas adjoining low-income census tracts. The purpose of an opportunity zone is to connect low-income communities with capital investments to promote economic growth. From rural areas to metropolitan cities, there are approximately 8,700 zones, covering 12% of all U.S. territory.
As an investor, you can take realized capital gains and reinvest them into qualified opportunity funds (QOFs) — gaining access to tax deferral, step-up benefits on five- or seven-year investments and the elimination of the capital gain tax on 10-year investment appreciation.
Whether you’re looking for a QOF to invest in or you’d like to create one, you can do a lot to get started. To help ensure your QOF runs smoothly and satisfies regulations, Wipfli assists QOFs in performing crucial services such as:
- Asset and income testing
- Software technology implementations
- Structuring plans
For investors, we’re committed to your education. There are many intricacies around opportunity zones, and there’s still more guidance coming. No matter if you need assistance confirming if an investment is in an opportunity zone and if it qualifies as a QOF, if you want to set up and properly structure your own QOF, or if you need to work through the complexities of business and personal tax returns, Wipfli is here to help.
Contact us to get started.
Featured Thought Leader
Brad Werner, CPA, MBA
Brad Werner is the Chicago market construction and real estate practice leader and an audit partner whose primary focus is on attest and accounting services. Working closely with members of management to improve their overall operations, he provides value to clients by offering broad experience in many industries and aspects of accounting and financial reporting. Brad ensures efficiency through solid planning and organizational skills in coordinating all aspects of each engagement. He effectively communicates complex accounting issues and solutions to his clients, enhancing overall retention.
Jim has nearly 20 years of experience dedicated to providing extraordinary, proactive advice to help construction and real estate organizations succeed and grow. He serves a full range of construction, real estate, and hospitality organizations, specializing in investment and development due diligence, financing, tax and business structuring, construction services, and exit strategies.
Josh Graham is an experienced senior manager in the firm’s tax practice. He is a tax leader of the Chicago market’s construction and real estate and private equity practices. Josh has spent the majority of his career focusing on the taxation of flow-through entities and also has significant corporate, multistate and international tax experience.