New Capital Gains Tax Incentive: Opportunity Zones

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CHAMBER NEWS Business Buzz CO M MUN ITY + COMMERCE N EWS

SOME B I G B UZ Z :

Beasley Allen Hosts 1,500 Attorneys During Annual Legal Conference & Expo In mid-November, Beasley, Allen, Crow, Methvin, Portis & Miles, P.C., hosted its 12th annual Legal Conference & Expo. The event drew more than 1,500 Alabama lawyers in private practice who came to get updates on the most current cases Beasley Allen attorneys have successfully litigated in the conferences’ case-review approach. The event is the largest of its kind in the state and one of the top five legal conferences in the country. It offered eight hours of free Continuing Legal Education credits certified by the Alabama State Bar. As with years

New Capital Gains Tax Incentive

past, the conference topics empha-

A new Federal Opportunity Zone Program is in the early stages of being implemented

Program Requirements:

that incentivizes private investment in desig-

•Gains must be invested in a

nated low-income areas through the deferral

QOF within 180 days.

and reduction of capital gains tax. This program has the potential to be the largest-ever economic development initiative. Businesses and individuals can defer paying tax on recognized gains if that gain is invested in a Qualified Opportunity Fund (QOF) and can receive a 10 to 15 percent reduction in their capital gains tax obligation if they commit to a long-term investment of a minimum of five years. Holding the investment for 10 years or more will allow the investor to avoid capital gains tax on the appreciation of the new investment. Developers and businesses looking to take advantage of this program can do so in one of two ways: by (1) investing capital gains in their own projects or businesses, or (2) seeking local or national capital from new and existing Opportunity Funds. Those Opportunity Funds are typically looking for strong potential returns over the course of their ten-year holding periods and may be able to

•QOF must invest in Qualified Opportunity Fund Property.

Eligible Investments (Qualified Opportunity Fund Property): •Partnership interests in businesses that operate in a qualified Opportunity Zone.

sized emerging areas of litigation and practice areas that are crucial to trial lawyers’ success. Beasley Allen Principal & Founder Jere Beasley discussed the important role lawyers play in improving society. Additional special guest speakers included Retirement Systems of Alabama CEO Dr. David Bronner; Alabama State Bar General Counsel Roman Shaul; and

•Stock ownership in businesses that

author, lecturer, trial consultant and at-

conduct most or all their operations within a

torney with Cusimano, Roberts & Mills,

qualified Opportunity Zone. • Property such as real estate located within a qualified Opportunity Zone.

Tax benefits: • Investments held for five years receive a 10 percent reduction in capital gains tax obligation.

LLC, Greg Cusimano. “It is an honor to once again welcome lawyers from across Alabama to Montgomery for the Beasley Allen Legal Conference,” said Dawn Hathcock, Vice President, Destination & Brand Development for the Montgomery Area Chamber of Commerce. “The confer-

• Investments held for seven years receive

ence guests have an opportunity to

a 15 percent reduction in capital gains tax

see what Montgomery has to offer as

obligation. • Investments held for 10 years will not be subject to capital gains on the appreciation.

provide additional investment capital.

a destination, translating into return visits for vacations, events or additional meetings. It also provides a huge economic impact in the River Region estimated to be roughly $1 million.”

94 MONTGOMERY BUSINESS JOURNAL


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