Qualified Opportunity Zones & Energy Projects: New Tax Incentives

Description

Tax reform created one of the country’s most significant economic development programs that encourages private investment in Qualified Opportunity Zones. Opportunity Zone Funds offer favorable treatment of returns on the investment, including deferral, reduction or possible elimination of gains tax on the appreciation of the fund interest.

Individual states designated communities as Qualified Opportunity Zones which have been approved by the Treasury Department and the Internal Revenue Service. Certain Energy projects, including renewables, mineral extraction, and oil and gas, are particularly well suited for Opportunity Zone Funds.

To take advantage of the tax benefits of the program, a taxpayer must reinvest gain proceeds in a Qualified Opportunity Fund within 180 days from the date of the sale or exchange of a capital asset. A Qualified Opportunity Fund must hold at least 90% of the fund’s holdings in Qualified Opportunity Zone property.

Counsel to companies and others in the energy industry must understand the structuring requirements to qualify for—and preserve—these tax benefits through the life of an investment and the interplay with other tax incentives available for energy projects.

Listen as our authoritative panel of energy and tax professionals examines Qualified Opportunity Zones and Qualified Opportunity Funds. The panel will discuss tax benefits associated with making energy and other business investments in Qualified Opportunity Zones, eligibility requirements, the process for getting fund approval, fund formation, and more.