An Opportunity Zone can be defined as a state-designated and IRS-certified community. Around 8,700 areas across the US have been designated as Opportunity Zones.

The origin of Opportunity Zones can be traced back to December 2017 when Congress passed the Tax Cuts and Jobs Act, which created a new Tax Code section also known as the 26-U.S. Code 1400Z-2. The new Tax Code made it possible to create Opportunity Zones in the US and
provided a clear definition of tax incentives available for investors who invested in the Opportunity Zones.

The basic premise behind the creation of Opportunity Zones is to promote economic activities in selected areas and regions in the US. The Tax Code provides guidelines on the creation of Opportunity Funds that can be invested in Opportunity Zones.