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Showing posts with the label Opportunity Zones

Opportunity Zones Forum - June 3, 2019

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Opportunity Zones Forum Crowne Plaza Times Square Manhattan, New York City June 3, 2019 www.opalgroup.net/trk/ozfb1918.html
15% discount code: CIROZF2019
The program will discuss how this program is encouraging long-term private sector investments in low-income urban and rural communities nationwide. Not only will this event explore the OZ investment process and regulations, but the forum will also explore current opportunities of the program and future potential implications of investing through Qualified Opportunity Zones.

New Opportunity Zone Guidance

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April 17th saw the release of a second set of guidance for the “Opportunity Zone” (OZ) program. As we noted in testimony to the IRS on February 14th, we remain concerned that the OZ program diverts needed tax revenue from public purposes and places this revenue in the hands of a mainly wealthy and white demographic unrepresentative of the US population as a whole. As the Hill Newspaper noted, the program has "drawn criticism from those who argue it will primarily benefit wealthy investors rather than residents of low-income neighborhoods." Today's regs do nothing to change this concern.

The regs released today benefit Opportunity Zone Funds (as opposed to residents). These funds are the financial vehicle used to make investments in Opportunity Zone areas. Today's regs are "designed to make it easier for funds to ensure that they are complying with a requirement that they have 90 percent of their assets invested in opportunity zones." In other words, the foc…

Recap of testimony at the Feb 14 IRS hearing on Opportunity Zones

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On Thursday, February 14, 2019, the IRS held a hearing on Qualified Opportunity Funds. Two hundred (200) experts and interested parties gathered at the IRS auditorium in Washington DC while 200 others waited.

My testimony focused on the general goals, regulations and fairness of the Opportunity Zone (OZ) Program. I started with a review of our performance:

•             On July 3, 1993, I wrote to Mary Schapiro, the former Chair of the US Securities and Exchange Commission (SEC) about correspondence dated July 2, 1993 from an “officer” of the Nigerian Ministry of Finance. I requested the SEC immediately warn the public. A timely warning was not issued to the investing public. (In response, the SEC launched retaliatory regulatory actions against Mr. Cunningham.)

•             In 1992, I designed the first mortgage security backed by 1 to 4 family home mortgage loans to low and moderate income persons and originated by Asian, Black, and Hispanic-owned banks.

•             On June 15, 2…

Opportunity Zones

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The Tax Cuts and Jobs Act, passed in 2017, created new tax incentives for investments in what are known as Opportunity Zones: targeted areas in the United States. Investments are made via Qualified Opportunity Funds, who are directed to promote economic development in 8,700 disadvantaged rural and urban (read Native, African American and Hispanic) communities (low-income census tracts selected by state governors and certified by the U.S. Treasury Department) by offering investors substantial federal tax advantages.

As one analyst explained:

"Assume an investor has a $1 million gain in Apple stocks and decides to sell. To keep it simple, let’s also assume the investor is in a 20 percent tax bracket, totaling $200,000 in capital gains tax. But instead of paying, the investor reinvests the $1 million in an Opportunity Fund.

If the investor holds for more than 10 years: the investor pays ZERO capital gains tax on the appreciation of that asset."

These benefits are only availabl…

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