Frequently Ask Questions

What is an Opportunity Zone?

An Opportunity Zone is an economically-distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment. Opportunity Zones are designated by the state and certified by the IRS. Roughly 8,700 areas in all 50 states have been designated.

• With bipartisan support, Opportunity Zones were added to the tax code by the Tax Cuts and Jobs Act on December 22, 2017.
• Tax Code (20 U.S. Code 1400Z-2) allowed for the creation of Opportunity Zones across the United States, and it defined the tax incentives that investors will receive for investing in Opportunity Zones.
• Opportunity Zones are an economic development tool—that is, they are designed to spur economic development by providing tax benefits to investors and job creation in distressed communities.

What is an Opportunity Fund?

An Opportunity Fund is a new investment vehicle created as part of the Tax Cuts and Jobs Act of 2017 to incentivize investment in targeted communities called Opportunity Zones. A Qualified Opportunity Fund is an investment vehicle that is set up as either a partnership or corporation for investing in eligible property that is located in a Qualified Opportunity Zone.

First, investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026. If the QOF investment is held for longer than 5 years, there is a 10% exclusion of the deferred gain. If held for more than 7 years, the 10% becomes 15%. Second, if the investor holds the investment in the Opportunity Fund for at least ten years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.

A Qualified Opportunity Fund is an investment vehicle classified as a corporation or a partnership and that was formed for the purpose of investing in “qualified opportunity zone property.”

• At least 90% of the Qualified Opportunity Funds assets must be invested in qualified opportunity zone property.
• Capital Gains that are invested in an Opportunity Fund money must constitute equity not debt.
• Properties in which the fund invests (directly or indirectly) generally must be substantially improved within 30 months or have their original use commence with the Opportunity Fund in the Opportunity Zone.
• The Fund generally intends to engage in ground up development or “substantially improve” an existing property by investing new money into a property in the amount of the original purchase price of the property allocable to purchased building(s) on the land.
• Eligible Capital Gains for investment into the Opportunity Fund include gains recognizable from taxable exchanges such as: the sale of stocks or bonds, the sale of a property, or the sale of an interest in a partnership.
• Both long-term and short-term Capital Gains can be invested into an Opportunity Fund.
• Gains taxed as ordinary income and gains from certain derivative contracts are not eligible for qualifying investment.
• Each Investor generally must invest Capital Gains into Opportunity Fund within 180 days of realizing Capital Gains.
• Investors generally must make an election to defer gain in the tax return for the year of the Capital Gains and the investment in the Opportunity Fund and are solely responsible for ensuring eligibility and qualification in each Investor’s individual circumstances.
• Many taxpayers can defer Capital Gains through Opportunity Fund investment including: individuals, C corporations (including REITs and RICs), partnerships and trusts.
• Only investors with qualifying Capital Gains are eligible for Opportunity Fund tax benefits.

Why Invest in an Opportunity Fund?

Opportunity Funds allow investors to defer federal taxes on any recent capital gains until December 31, 2026, reduce that tax payment by up to 15%, and pay as little as zero federal taxes on potential profits from an Opportunity Fund if the investment is held for 10 years. By holding their shares in the Opportunity Fund for ten years, investors can achieve maximum benefits from their investments into the fund. It’s as easy as:

1. Defer Capital Gains
Any Capital Gains can be invested into an Opportunity Fund. By investing in an Opportunity Fund, the invested Capital Gains do not need to be recognized when the investment is sold or exchanged or until December 31, 2026.

2. Reduce Capital Gains
After holding an investment in the Opportunity Fund for seven years the Capital Gains tax on the original Capital Gains is reduced by 15%. This is the equivalent of having a 15% step-up in basis on the initial investment for seven years.

3. No Capital Gains tax on fund profits
After holding an investment in the Opportunity Fund for at least ten, an investor’s disposition of an investment in the Opportunity Fund does not result in any additional federal income taxes.

What is it like to work with us?

We assembled a world-class team.

We are locals that  understand and appreciate Rural America.

We thrive in a fast-paced, values-driven culture. We collectively work to reach bottom line business goals in the fastest and most creative way. We respect and value diversity, the innovative spirit and integrity.

We believe transparency is the best way to be an efficient and ethical organization. This comes through in how we manage our team:

• Initiatives & goals are communicated to the entire organization. Everyone at Investments by SunAmerica always knows what the company is working toward.
• Internal processes are designed to provide rapid response to customers. Issues can be quickly escalated and resolved because employees are empowered to make decisions.