Congress has work to do in legislation that revisits Opportunity Zones, Published in the DJC Oregon

In an article published in the DJC Oregon, Coni S. Rathbone writes about how proposed congressional changes to laws surrounding Opportunity Zones (OZs) are meant to increase transparency and accountability. One such change is that investors in Qualified Opportunity Funds (QOFs) will not have to pay taxes on those earnings for an additional two years. Another change is that QOFs will be able to invest in other QOFs.

“Presently, if a husband-and-wife fund desires to invest with a large fund, the small QOF must invest in the subsidiary Qualified Opportunity Zone Business Entity (QOZB),” Rathbone writes. “The biggest problem with this existing structure is that for those funds that are sold as securities offerings, it requires an entirely new securities offering at the QOZB level, which many sponsors are reluctant to allow.”

Rathbone also suggests that the success of the program may spell the end for some QOZs. However, the QOZs that are losing their titles will not see any significant changes in the near future.

“Moreover, because the program has been successful, some of the zones that were originally impoverished are not any longer—and can thus be redesignated to create room for other needy areas,” she writes. “Thankfully, the proposal does allow for strong grandfathering provisions for projects that have already begun in tracts that are being disqualified.”

Read the story in full; click here, or download a pdf.

Learn more about Attorney Coni Rathbone here.