No effect. It's all additive.
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How will the stacking of other tax credits impact Opportunity Zone investments?
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There doesn’t seem to be any restriction on stacking other credits.
There is no impact. Using the tax benefits of the Opportunity Zone investment does not limit any other tax benefits, such as federal tax benefits. At present, I am not aware of any state tax benefits that would be reduced or eliminated by taking advantage of the Opportunity Zone benefits. If there is a specific tax benefit you are concerned about, please identify it and any possible impact could be researched. The universe of state and local benefits is large and something may have missed our attention.
One of the great benefits of Opportunity Zone investment is it can be coupled with various tax credits and incentives such as TIF, abatement, state and local incentives, grants and EB-5, thereby strengthening the overall project and investment. We have done so with Opportunity Zone real estate investment projects.
Each separate tax credit stands alone, based on its own merits.
Stacking tax credits (like the low-income housing tax credit or the new markets tax credit) can enhance returns on OZ investments. Care must be taken, however, when combining these other programs with OZs to ensure the rules from all programs are complied with.
This question is quite broad. To give a quality answer we would need a lot more information. The tax benefits of an Opportunity Zone investment should, in theory, be able to be utilized along with other tax benefits without interference. However, there are so many various tax credits available depending on an investor's situation that this question is much better suited to a conversation between investors and their tax advisors.
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