Since the passage of the 2017 Tax Cuts & Jobs Act, Opportunity Zones have become a vital tool for investors, real estate developers, public-private partnerships, entrepreneurs, and more. Opportunity Zones are designated geographic areas eligible for extra tax benefits. Why? Because these communities are economically distressed and could use an extra boost to attract business investment that spurs employment opportunities.
There are more than 8,500 Opportunity Zones throughout the U.S. And according to the Economic Innovation Group (EIG), the rate of poverty in these areas is double the national average. With just over four years since these Opportunity Zones were implemented, how has the idea fared?
Opportunity Zones are lifting Americans out of poverty.
A 2020 report from The White House Council of Economic Advisers shows funds already raised by Qualified Opportunity Funds–the investment vehicle for Opportunity Zones–could lift one million Americans out of poverty and into self-sufficiency. This would decrease the poverty rate within Opportunity Zones by 11 percent.
Opportunity Zones have spurred economic growth and job creation.
An EIG report shows Opportunity Zones are currently home to 24 million jobs and over 1.6 million businesses. To encourage the next generation of business owners, Opportunity Zones also house over 280 entrepreneurship incubators and accelerators—such as Rock 31 Entrepreneur Program. Launched in 2019, Rock 31 Entrepreneur Program connects entrepreneurs and start-up companies with mentors, accountants, attorneys, and other tools they need to be successful.
This is only one example. To date, Opportunity Zones have attracted nearly $30 billion in economic investment.