What are Opportunity Zones Tax Deferrals or Abatements?

The City of Seat Pleasant was designated as an Opportunity Zone by the United States Treasury Department and the Governor of Maryland as of June 2018. This entitles investors with high unrealized capital gains to cash in the appreciation of their gains while deferring the taxes on the gains if they redirect these gains into properties located in areas approved as Opportunity Zones. The City of Seat Pleasant was designed as Opportunity Zones to spur economic development by providing tax benefits to investors:

  • First, investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026. If the QOF investment is held for longer than 5 years, there is a 10% exclusion of the deferred gain. If held for more than 7 years, the 10% becomes 15%.
  • Second, if the investor holds the investment in the Qualified Opportunity Fund for at least ten years, the investor is eligible for an increase if the basis of the QOF investment is equal to its fair market value on the date that the QOF investment is sold or exchanged.

Show All Answers

1. What is the General Income Tax Credit for hiring new employees?
2. What is the Large State Income Tax Credit for hiring economically disadvantaged employees?
3. What is the New Job Creation Tax Credit for hiring economically disadvantaged employees?
4. What is a Business Personal Property Tax Credit?
5. What are Real Estate Tax Credits for new construction?
6. What are Opportunity Zones Tax Deferrals or Abatements?
7. What is a New Market Tax Credit (NMTC) and how does the Tax Credit Work in the City of Seat Pleasant?
8. What is the purpose of Health Enterprise Zone (HEZ) Investment Initiative?
9. How does a Sustainable Community Designation receive funding?
10. What is a Qualified Opportunity Fund?
11. Does an investor need to live in Seat Pleasant to take advantage of the tax benefits of an Opportunity Zone?
12. Is the City of Seat Pleasant a qualified HUB Zone?
13. What are the guidelines for federal level tax incentives?
14. How do I apply for a business license?
15. What is the Economic Development Revolving Loan Fund (ED-RLF)?
16. What is the EB-5 Visa Program?
17. What's the difference between an Opportunity Zone investment versus a Non-Opportunity Zone investment?