Opportunity Zones & Funds for Developers and Investors

Wednesday, June 13, 2018

New Incentive for reinvesting Capital Gains and deferring taxes
Requires "Fund" investment to be in Qualified Opportunity Zones
Treasury Qualified 11 tracts in Spokane to accept investment "Funds"
Treasury is still completing the rules for the "Funds"
What we do know about the "Funds"
- Can be a Partnership or Corporation set up to invest in QOZ property and they will self-certify with IRS
- You can get the tax benefits, even if you don't live, work or have a business in an Opportunity Zone

If the investment is held for less than 5 years as of Dec. 31, 2026: All of the deferred gain is recognized as of 12/31/2026. If the investment is sold or exchanged after 12/31/2026 for FMV (after being held for at least 10 years) the taxpayer recognizes no additional gain, due to the FMV basis election, even if the investment has increased in value between 12/31/2026 and the date of disposition.
If the investment is held for at least 5 years by Dec. 31, 2026: 10% basis adjustment applies; 90% of deferred gain is recognized as of 12/31/2026. If the investment is sold or exchanged after 12/31/2026 for FMV (after being held for at least 10 years) the taxpayer recognizes no additional gain, due to the FMV basis election, even if the investment has increased in value between 12/31/2026 and the date of disposition.
If the investment is held for at least 7 years by Dec. 31, 2026: 15% basis adjustment applies; 85% of deferred gain is recognized as of 12/31/2026. If the investment is sold or exchanged after 12/31/2026 for FMV (after being held for at least 10 years) the taxpayer recognizes no additional gain, due to the FMV basis election, even if the investment has increased in value between 12/31/2026 and the date of disposition.

Economically distressed residents
Attracting investment
Targeted Investment Areas
Aligned with other incentive areas
Partners in place Public Development Authorities and Business Improvement Districts
Pipeline projects ready go
Opportunities for new investment

Grow targeted areas - Invest in key neighborhoods and business centers; especially PDA's
Marketing Spokane – Market Spokane's urban advantages and experiences to grow jobs and economic development
Public amenities - Invest in key public amenities and facilities
Regional collaboration – work collaboratively with regional partners

The University District