Opportunity Zone

Evanston, Wyoming has a designated Opportunity Zone along I-80. Locating a business, or investing, within this census tract provides multiple financial incentives. In addition, commercial real estate along I-80 makes it easy to reach the Salt Lake City metro, along with the rest of Wyoming.

What is an Opportunity Zone?

An opportunity zone is an economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment. In 2017, opportunity zones were added to the tax code by the Tax Cuts and Jobs Act. This federal legislation recognized distressed neighborhoods with high-poverty as places needing investment. Any person or business can invest in an Opportunity Zone, whether they live in the area or not.

Evanston, Wyoming’s Opportunity Zone is an economic development tool designed to attract investment and job creation.

How does the Evanston Opportunity Zone work?

Opportunity zones are designed to spur economic development by providing tax benefits to investors. First, investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026.   If the QOF investment is held for longer than 5 years, there is a 10% exclusion of the deferred gain.  If held for more than 7 years, the 10% becomes 15%.  Second, if the investor holds the investment in the Opportunity Fund for at least ten years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.

This program is less restrictive than other tax credit programs such as New Markets Tax Credits (NMTC) and Program and Low Income Housing Tax Credit (LIHTC) Program. Opportunity Zones don’t operate through a tax credit program. Instead, Opportunity Zone designation and investment are governed through two Internal Revenue Code sections. This removes any limitation on the number of Opportunity Funds that can exist, making them more the product of an entirely new IRS rule that changes the tax treatment of capital gains than the subject of a more traditionally structured tax credit program.

There is no cap on the amount of capital that can be invested into qualified Opportunity Zones, and hence no arbitrary limit on the extent to which Opportunity Zones and Opportunity Funds may help reshape downtrodden communities.

For more information contact Rocco O’Neill, Director – Community Development at (307) 783-6309 or email roneill@evanstonwy.org.