Birmingham, MI – Schechter, an independent investment advisory, private capital and life insurance firm, in partnership with Related Companies, CIM Group, and UHY LLP, invited Detroit-based investors to an exploratory discussion regarding the investment and tax landscape of Opportunity Zones on Tuesday, June 18th.
The event, held at the Birmingham 8 Theatre, featured expert panelists from the four aforementioned firms; Aaron Hodari, Managing Director, Schechter; Michael Winston, Managing Director, Related Fund Management; Sean Morris, Managing Director, CIM Group; Jonathon Schumaker, Tax Manager, UHY LLP.
What are the tax benefits of Opportunity Zones?
Opportunity Zones were created in the 2017 Tax Reform Bill to incentivize investment in low-income communities by providing three tax benefits to investors investing in Opportunity Zone Funds:
1. Deferral of Gain from Other Investments Invested in an Opportunity Zone Fund
- Gain must be invested in an Opportunity Zone fund within 180 days of realizing such gain
- Tax deferred until the earlier of 1) December 31, 2026 and 2) when the interest in an Opportunity Zone fund is sold
2. Reduction of Taxes Payable on Deferred Gain 2
- If held for at least 5 years: 10% reduction
- If held for at least 7 years: additional 5% reduction (total of 15%)
3.Exclusion of Gain on Opportunity Zone Fund Investment
- If held for at least 10 years, gain recognized on the sale of the interest in an Opportunity Zone fund (i.e., gain above the original deferred amount) is exempt from tax.
Schechter is a boutique, third-generation wealth advisory and financial services firm. For 80 years, our multi-disciplined team consisting of JDs, CPAs, LLMs, CLUs, PFSs, CAPs, MBAs, CFA® charterholders, CFP® practitioners and CIMA® consultants have been quietly advising wealthy families on financial matters including: Institutional quality investment advisory services, private capital and alternative investments, advanced life insurance planning, income and estate taxes, business succession and charitable planning.