By Andrew P. Doup – Kegler Brown Hill + Ritter
Taxpayers stand to save millions in income tax by reinvesting capital gains into opportunity zones. Opportunity zones are a bipartisan-sponsored federal tax incentive designed to encourage investment in distressed neighborhoods.
Many Central Ohio entrepreneurs have started new business ventures in opportunity zones because these federal and state income tax benefits, coupled with other federal and local programs designed to support private investment into opportunity zones, have created a new, tax-advantaged capital market for business investment.
In 2019, taxpayers saved approximately $240 million by reinvesting their otherwise taxable capital gains into 85 new business ventures located in Ohio opportunity zones, according to filings made with the Ohio Development Services Agency. Nationally, an estimated $6.72 billion has been invested in opportunity zone funds, according to tax-advising firm Novogradac.