SECRETARY CARSON TO LEAD WHITE HOUSE OPPORTUNITY AND REVITALIZATION COUNCIL
[Yesterday President Trump signed a new Executive Order}
12 Dec 2018 @ 3:54 PM (16 hours ago)
HUD No. 18-144
HUD Public Affairs
December 12, 2018
SECRETARY CARSON TO LEAD WHITE HOUSE OPPORTUNITY AND REVITALIZATION COUNCILWASHINGTON – Today, President Donald Trump signed an Executive Order establishing the White House Opportunity and Revitalization Council and named U.S. Housing and Urban Development (HUD) Secretary Ben Carson as its chairperson.
The Council’s 13 Federal member agencies will engage with governments at all levels on ways to more effectively use taxpayer dollars to revitalize low-income communities. The Council will improve revitalization efforts by streamlining, coordinating, and targeting existing Federal programs to Opportunity Zones, economically distressed communities where new investments may be eligible for preferential tax treatment.
Additionally, the Council will consider legislative proposals and undertake regulatory reform to remove barriers to revitalization efforts and present the President with options to encourage capital investment in economically distressed communities.
“These are still early days for the work of the Council and Opportunity Zones, but the groundwork has been laid,” Secretary Carson said. “The seeds the President has planted are growing and the promise they hold will improve places long forgotten, and the lives of those who call those places home.
President Trump signed the 2017 Tax Cuts and Jobs Act, creating Opportunity Zones to stimulate long-term investments in low-income communities. The program offers capital gains tax relief to those who invest in these distressed areas. This program is anticipated to spur $100 billion in private capital investment in Opportunity Zones. Incentivizing investment in low-income communities fosters economic revitalization, job creation, and promotes sustainable economic growth across the nation, especially in communities HUD serves.
Opportunity Zones are a powerful vehicle for bringing economic growth and job creation to the American communities that need it the most. On average, the median family income in an Opportunity Zone is 37 percent below the state median. To date, 8,761 communities in all 50 States, Washington D.C., and five Territories have been designated as Opportunity Zones. Nearly 35 million Americans live in communities designated as Opportunity Zones.
Currently, there are approximately 380,000 Public Housing units and approximately 340,000 Project-Based Rental Assistance units within Opportunity Zones. Nearly a third of the more than 100,000 rental units preserved through HUD’s Rental Assistance Demonstration (RAD) are located in Opportunity Zones. Read more about the RAD program
HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. More information about HUD and its programs is available on the Internet at www.hud.gov and http://espanol.hud.gov. You can also connect with HUD on social media or sign up for news alerts on HUD's Email List.
Tax reform creates opportunity zone tax incentive
Tax Tip 2018-191, December 11, 2018
Qualified Opportunity Zones were created by the 2017 Tax Cuts and Jobs Act. These zones are designed to spur economic development and job creation in distressed communities throughout the country and U.S. possessions by providing tax benefits to investors who invest eligible capital into these communities. Taxpayers may defer tax on eligible capital gains by making an appropriate investment in a Qualified Opportunity Fund and meeting other requirements.
In the case of an eligible capital gain realized by a partnership, the rules allow either a partnership or its partners to elect deferral. Similar rules apply to other pass-through entities, such as S corporations and its shareholders, as well as estates and trusts and its beneficiaries.
To qualify for deferral:
- Capital gains must be invested in a QOF within 180 days.
- Taxpayer elects deferral on Form 8949 and files with its tax return.
- Investment in the QOF must be an equity interest, not a debt interest.
> If a taxpayer holds its QOF investment at least five years, the taxpayer may exclude 10 percent of the original deferred gain.
> If a taxpayer holds its QOF investment for at least seven years, the taxpayer may exclude an additional five percent of the original deferred gain for a total exclusion of 15 percent of the original deferred gain.
The original deferred gain – less the amount excluded due to the five and seven year holding periods – is recognized on the earlier of sale or exchange of the investment, or December 31, 2026.
> If the taxpayer holds the investment in the QOF for at least 10 years, the taxpayer may elect to increase its basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged. This may eliminate all or a substantial amount of gain due to appreciation on the QOF investment.