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Opportunity Zone Tax Benefits

Almost the entire Greeley Downtown Development Authority boundary is designated as an Opportunity Zone. Opportunity Zones were enacted as part of the 2017 tax reform package (Tax Cuts and Jobs Act) and is a federal tax incentive for investors to invest in low-income urban and rural communities through the favorable treatment of reinvested capital gains and forgiveness of tax on new capital gains.

Benefits of an Opportunity Zone investment include:

1. Deferral – No up-front tax bill on the rolled-over capital gain and investors can defer their original tax bill until the earlier of a) December 31, 2026, or b) the sale of the Opportunity Zone investment

2. Reduction of tax on the rolled-over capital gain investment for long-term holding.

  • A 5-year holding increases the rolled-over capital gains basis by 10%
  • A 7-year holding increases the rolled-over capital gain investment basis 5% for a total of 15%

3. Tax-free appreciation– If an Opportunity Fund investment is held for ten years, the taxpayer pays no capital gains tax on the appreciation

For more information, check out Colorado Office of Economic Development & International Trade