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Opportunity Zones

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Phoenix is Investment.

​​​In December of 2017, the "Tax Cuts and Jobs Act" was passed by the federal government.  Phoenix City Council approved the census tract submissions on February 13, 2018​.
This landmark legislation established the Opportunity Zone program and Phoenix, a premier city for businesses to locate, expand, and develop, looks to encourage additional growth and investment through this program.

  
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​​​Please find a map of Phoenix's 42 Opportunity Zones below.

These Opportunity Zones were certified by the Department of Treasury on April 9, 2018.

PDF MAP OF PHOENIX'S OPPORTUNITY ZONES

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The City of Phoenix has developed a prospectus for opportunity zones located within Phoenix.

Learn more about the diverse and unique development opportunities that our city has to offer.

​​Please click the image below to view and download the document.







​Program Overview

The program was created to increase investment by investors into specific low-income communities. 

Under the program, investors who experience capital gains can invest that money into Qualified Opportunity Funds that spur development in designated, distressed census tracts known as Opportunity Zones.

Doing so comes with tax benefits to the investors, and most importantly, will provide positive economic and social impacts within these communities.​


​​​Qualified Investment

To have a qualified investment that is eligible for the tax incentives:

  1.  The investment must be made through a Qualified Opportunity Fund. The fund must hold at least ​90% of its assets in the property.
  2. Eligible capital gain must be reinvested into a Qualified Opportunity Fund (QOF) within 180 days of realization.



​Tax Benefits for Investors

Tax on the initial realized capital gain is deferred and reduced depending on the length of time the investment is held for.

If an investment is held for 5 ​years, the taxable amount of the capital gains reinvested is reduced by 10%.

If an investment is held for 7 years, the taxable amount of the capital gains reinvested is reduced by 15%

If investment is held for 10 years, capital gains made on the investment will not be taxed.





Qualified Opportunity Zone Business

A qualified Opportunity Zone business is a business in which substantially all of the tangible property owned or leased by the business is used in an opportunity zone, with at least 50% of the gross income earned by the business coming from the active conduct of business within an Opportunity Zone. 


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Examples of Qualified Businesses:

  • Manufacturing
  • Retail, Dining, & Entertainment Space
  • Mixed-Use Development
  • Transportation & Distribution
  • High-Density Residential - especially workforce housing
  • Research & Development
  • Corporate Offices


Examples of Businesses that do not qualify:

  • Private or Commercial golf course
  • Country Clubs
  • Facilities used for gambling
  • Any store with the principal business of which is the sale of alcoholic beverages for consumption off premises

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Additional Resources:

LOCUS Opportunity Zone Navigator - interactive map showing zones with Brownfields and Transit:
https://smartgrowthamerica.org/opportunity-zones/

For a list of Opportunity Funds:
https://www.ncsha.org/resource/opportunity-zone-fund-directory/

For more information on Arizona's Opportunity Zones:
http://www.azcommerce.com/arizona-opportunity-zo​nes/

Treasury's CDFI Opportunity Zones Resources:
https://www.cdfifund.gov/pages/opportunity-zones.aspx

Economic Innovation Group's Opportunity Zones:
http://eig.org/opportunityzones/resources

For IRS frequently asked questions, visit:
https://www.irs.gov/newsroom/opportunity-zones​-frequently-asked-questions

U.S. Economic Development Administration​ Website:
​​https://eda.gov/opportunity-zones/

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​For more information, or any questions, contact:

Joseph MacEwan, Economic Development Research Specialist, at joseph.macewan@phoenix.gov

 

 

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