A Qualified Opportunity Fund is an investment vehicle organized as a corporation or partnership. The Fund utilizes an investor’s capital gain from a prior investment, with the specific purpose of investing in Qualified Opportunity Zone assets. A fund must hold at least 90 percent of its assets in qualifying Opportunity Zones.
Currently, the statute allows for broad participation in the creation of Opportunity Funds with the goal of drawing a large cross section of investors to support a variety of needs found in low income communities nationwide. In order to be eligible for the program, an investor must rollover (exchange) a capital gain into an Opportunity Fund within 180 days of realizing the gain. Any entity, (private investors, privately-held investment companies, banks, community development entities, financial institutions, venture capital groups, developer consortiums, regional economic development organizations, etc.) can participate so long as they follow the guidelines set out by the statute and The Treasury (forthcoming). Please see Regulatory page for current updates as regulations are published.
The three pillars, or advantages, of participating in Opportunity Zone investments Vs. traditional investments are below: