Chicago Opportunity Zones

The Qualified Opportunity Zone incentive is part of the Tax Cuts & Jobs Act of 2017 and is the largest new federal economic development program enacted in years. There are 181 Opportunity Zones in Cook County that offer several tax benefits to investors that could spur substantial new capital influx into targeted neighborhoods within Chicago and Cook County.

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How the Qualified Opportunity Zone Program Works

The Qualified Opportunity Zone (“QOZ”) program seeks to encourage investment and stimulate economic growth in certain distressed communities by providing various federal income tax benefits to taxpayers who invest in real estate and businesses that operate within these zones.

Benefit 1: Defer Capital Gains

When you invest your capital gains in a Qualified Opportunity Fund, you can defer those gains until December 31, 2026..
Benefit 2: Reduce Capital Gains

When you invest your capital gains in a Qualified Opportunity Fund, you can reduce your capital gains by up to 15% after a 7-year holding period..
Benefit 3: Avoid Capital Gains Tax

You pay zero capital gains taxes on your appreciation (exclusive of original capital gains invested) within a Qualified Opportunity Fund after a 10-year holding period..

Investment Timeline

When you invest your capital gain in a Qualified Opportunity Fund, you can defer those gains until December 31, 2026

5 Year
5 Year Hold

After a 5-year holding period taxable basis decreases by 10%

7 Year Hold

After a 7-year holding period taxable basis decreases by 15%

7 Year
10 Year
10 Year Hold

After a 10-year hold Opportunity Fund gain become tax exempt (exclusive of original capital gains)

Opportunity Zones By The Numbers

8,764 CENSUS TRACTS

The total number of census tracts certified as Opportunity Zones by the U.S. Treasury.

$6.1 TRILLION

Potential unrealized capital gains eligible for Qualified Opportunity Fund investment and tax treatment.

$100 BILLION

Treasury Secretary Steven Mnuchin’s estimate of private capital that will flow into Opportunity Zones.

News Articles & Announcements

News
Proposed Legislation to Extend and Improve Opportunity Zones

Bipartisan legislation was introduced to both the Senate and the U.S. House of Representatives last week that would improve Opportunity Zones and push back the tax incentive’s deferral date from 2026 to 2028. The legislation, known as the Opportunity Zones Improvement, Transparency, and Extension Act,  would implement the following changes:   Extending the lifespan of the […]

Ashley Dillard, CCIM

April 12, 2022

 Reading time: 2 minutes
Single Family Homes in Chicago Opportunity Zone
News
OZs Produced an Extra 2.2% Per Year in Neighborhood Home Price Appreciation

Opportunity Zones prove to have a meaningful economic impact on single-family home prices as well as commercial property prices.  The article below from GlobeSt.com outlines the impact. Three years ago, the Tax Cuts and Jobs Act of 2017 created a provision, known as qualified opportunity zones, to rejuvenate economically distressed communities across the US and […]

Ashley Dillard, CCIM

June 30, 2021

 Reading time: 1 minute
News
IRS Will Not Change OZ Boundaries

OZ investors no longer need to be concerned about a possible change in zone boundaries after the 2020 census. The Internal Revenue Service has issued a statement that says opportunity zone boundaries as they were established by the 2017 tax cut law will not be changed by any finding of the 2020 census. In the […]

Ashley Dillard, CCIM

May 14, 2021

 Reading time: 2 minutes