Permanence of Incentive, Extending Deferral Deadline, Transparency Among Ideas Encouraged in Communication to Deputy Treasury Secretary Nominee, Incoming Administration
SAN FRANCISCO, Jan. 7, 2025 /PRNewswire-PRWeb/ -- The Novogradac Opportunity Zones Working Group (OZWG) on Jan. 3, 2025, submitted a letter to the nominee for deputy secretary for the U.S. Department of the Treasury and to returning President Donald Trump's transition team and forthcoming administration to consider legislative and regulatory efforts to enhance and reinforce the opportunity zones (OZ) incentive.
Congress enacted the OZ legislation under the first Trump administration via the 2017 Tax Cuts and Jobs Act (TCJA). The OZ incentive allows for private, patient capital investment in distressed communities across America.
"The recommendations proposed in this letter represent the collective consensus of leaders working with the opportunity zones incentive to spur greater levels of investment of equity capital in America's distressed communities," said Michael J. Novogradac, CPA, managing partner of Novogradac. "Extension, permanence and modernization of the opportunity zones incentive are vital to expanding the availability of equity capital in distressed communities. We look forward to working with the new administration and congress to further the goals of economic prosperity and possibility for all Americans."
Among many recommendations, the letter calls for permanency for the incentive. Qualified opportunity funds (QOFs) tracked by Novogradac have reported more than $40 billion in equity raised since 2018, a statistic that represents approximately one-third of the overall total of equity raised for investment in distressed communities since 2018. Capital gains realized after Dec. 31, 2026, will no longer be eligible for the OZ incentive.
"Understanding that 2025 looks to be a major year for tax legislation, it's vital that extension, expansion and permanency of the opportunity zones incentive be a component of that effort at the federal level," said Jason Watkins, CPA, a partner in Novogradac's metro Atlanta office and leader of the OZWG. "We have seen legislation introduced in the past several Congresses to potentially take action in both chambers, including the Opportunity Zones Transparency, Extension and Improvement Act. Given the upcoming deadline in 2026, the OZ Working Group through this letter recommends decisive action to continue the work of this initiative."
The OZWG addressed its 16-page letter to Michael Faulkender, nominee for deputy secretary of the Treasury Department, as well as the Trump administration's transition team. The letter proposes a variety of initiatives for the incentive, including near-term legislative changes, long-term programmatic changes, including both legislative changes and regulatory proposals.
For more information about the OZ incentive and to view the letter, visit novoco.com.
About Novogradac
Novogradac, which has been in business for more than 35 years, has grown to more than 760 employees and partners with offices in more than 25 cities. Tax, audit and consulting specialty practice areas for Novogradac include affordable housing, community development, historic rehabilitation and renewable energy. For additional information on Novogradac's personnel and areas of expertise, visit http://www.novoco.com or call (415) 356-8000.
About the Novogradac Opportunity Zones Working Group
Novogradac founded the OZWG in 2017 during the legislative phase of tax reform for the express purpose of identifying and addressing technical and administrative issues that arise under the federal OZ incentive. Its members primarily include investors, syndicators, lenders, community development entities (CDEs), community development financial institutions (CDFIs), for-profit and nonprofit developers, consultants, law firms and other community development professionals who work together to suggest consensus solutions to technical OZ incentive issues and provide recommendations to make the OZ incentive more efficient in delivering benefits to low-income communities.
Media Contact
Novogradac, Novogradac & Company LLP, (415) 356-8000, [email protected], www.novoco.com
SOURCE Novogradac & Company LLP
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