How can my nonprofit benefit from the Opportunity Zone tax incentive?

Answers

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  Marko Belej

  Taft

  May 26, 2021

  Unfortunately, it probably can't. Keep in mind that OZ benefits generally are realized by investors who invest capital gains in businesses located in Opportunity Zones; they are not realized by the businesses themselves. Therefore, even if your nonprofit were a for-profit business, it would not directly benefit from being in an opportunity zone itself. Furthermore, because nonprofits typically do not have investors (or other owners), there doesn't appear to be a way for your nonprofit to pass on OZ benefits to anyone else (as a for-profit business could).

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  Matthew Rappaport

  Falcon Rappaport & Berkman

  May 26, 2021

  Nonprofits are not really meant for Opportunity Zones, but we've had some instances in which nonprofits have sponsored some ventures in which private investors have deployed capital, and those ventures are set up as QOFs. If you're a nonprofit renting an office in an OZ, only a private owner of the premises can really benefit, not the nonprofit itself. Matthew E. Rappaport, Esq., LL.M. (Taxation) Falcon Rappaport & Berkman PLLC  1185 Avenue of the Americas, Third Floor New York, New York 10036 T: (212) 203-3255 x 132 F: (212) 203-3215 D: (212) 453-9889 mer@frblaw.com 265 Sunrise Highway, Suite 50 (MAIL) Rockville Centre, New York 11570 T: (516) 599-0888 F: (516) 599-0889 We have a Great Neck satellite office and access to several meeting locations on the North Shore. Please refer to our e-mail policies here if you are not already familiar with them.

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