Opportunity Zones allow investors to benefit from the initiative’s capital gains tax breaks, to make money, accomplish multi-generational long-term financial planning and diversify their portfolios away from equities.
White argues that the pandemic-fueled shutdown has given investors more time to consider Opportunity Zone investments. When doing that, he says they’ll will realize immediate benefits, such as saving 10% of any capital gains if they invested in a Qualified Opportunity Zone B (QOZB) before December 31, 2021, and they have until April 15, 2027, to pay any capital gains owed.
Still, the social issues, including unemployment, population decline, poverty, drugs, crime, failing infrastructure, make urban and rural Opportunity Zones, are similar. “In rural communities, those issues may be even more pronounced,” White says. “The coronavirus crisis, with its health and safety fears, compounds the existing stressors – rural communities might have fewer resources in place for urgent health care: fewer hospitals, fewer ambulances, fewer walk-in clinics and fewer health care workers. So, the need is there.”
Citing reporting from The Hill, White says rural residents create self-employment opportunities at a slightly higher rate than the national average.
“The challenge is access to capital as most of it is siphoned to small business investment on the coasts,” White says. “Many rural entrepreneurs don’t know about the opportunities for them via QOZs [Qualified Opportunity Zones] and QOFs [Qualified Opportunity Funds]. So, there is a huge upside if we can get the states and local communities to support QOZBs for rural communities. Still, investors may need the added incentives of local or state tax breaks in addition to those offered by investing through QOFs.”
His latest book is a heartfelt rallying cry for investors: Opportunity Investing: How to Revitalize Urban and Rural Communities with Opportunity Funds, launched March 31, 2020.