If you have recently had a capital gains event or if you anticipate having one in the near future, an exciting new opportunity exists for investors in the Cleveland County area.
The Opportunity Zone Program is a federal bi-partisan program in the 2017 Tax Cuts Jobs Act, and is a potential major source of untapped capital that seeks to revitalize under-served communities. The program incentives investment of capital gains by deferring or reducing tax obligations and allowing the investment to grow tax-deferred or potentially tax-free, after a 10-year hold period.
“Before this, there were limited ways to defer your capital gains, mainly through real estate investments, such as a 1031 Exchange or a Delaware Statutory Trust," explains Jordan Cramer, chief executive officer of the Revive Qualified Opportunity Zone Fund.
"The Opportunity Zone program allows you to still defer those capital gains, but now the investor is not limited only to real estate investments, they are allowed to take those capital gains and move them over to a business that is located inside an Opportunity Zone through the Opportunity Zone Fund."
“You can hold your fund position for 10 years while your investment is creating economic development in the community in a positive way. Then, when you sell your position, you don’t have to pay taxes on the gains.”
Revive, which has been in operation since 2020, believes that social impact investing is the key to its success, as investing in QOFs directly helps support those who live and work in the community.
Revive’s QOF focuses on rapid growth, high-yield sustainable investment opportunities. By placing existing assets with accumulated capital gains into this fund, these gains are not taxed until 2027, or when the asset is sold. For investments held for at least 10 years, investors pay no taxes on any capital gains subsequently produced by their investments in the QOF.
“There are three different Opportunity Zones in Cleveland County, and 40% of the University of Oklahoma campus also qualifies,” adds Tyson Heltzen, co-founder and chief financial officer of Revive Qualified Opportunity Zone Fund.
“Investment opportunities through the fund can now be invested in businesses located inside a Qualified Opportunity Zone. These are things that are typically investing in community improvement inside the Zone.”
For individuals who experience a capital gains event, they can invest funds into a QOF on a tax-deferred basis within 180 days of the sale or exchange to qualify for the tax benefits. Revive can also convert existing 1031 Exchange and DSTs into an Opportunity Zone investment.
“For example, an investor can take an acre of land in an Opportunity Zone and increase the value of the land by developing it,” Tyson continues.
“That's the economic impact of the Opportunity Zones, as they help that dollar stay in the community. A dollar earned and invested in our community will turn over 4-7 times before it leaves the community. The city benefits from the economic development, and the reinvestment of the capital gains. The investor can potentially completely eliminate their capital gains taxes, while giving back to the community where they live.”
In addition to the Opportunity Zones in Cleveland County, there are also more than 10 Opportunity Zones in Oklahoma City. Revive continues to seek impactful and innovative projects in and around Oklahoma focusing on real estate, agriculture, technology, energy and more.
“Investing in an Opportunity Zone Fund is very tax-efficient for those looking to retire or make a difference in the community. We can help convert assets into an Opportunity Zone project, and take advantage of the tax opportunities to protect yourself and your family from capital gains taxes now and down the road,” Jordan concludes. “This really is a revolutionary opportunity.”
Interested investors who have recently experienced a capital gains event, or expect to experience one in the near future, can schedule an appointment online at ReviveOpportunityFund.com, call 405.474.1144, or email tyson@reviveQOF.com. For additional information, to view a current investment project opportunity and to access frequently asked questions about QOFs, visit reviveQOF.com.