Salt Lake City’s Opportunity Zones are open for business. Opportunity Zone legislation is becoming clearer and we are optimistic that it will improve even more. Which is why we are excited to share some new movement from H.U.D. and the U.S. Treasury.

First, H.U.D is developing an Opportunity Zone (OZ) Council that will publish a best practice guide for OZ’s and will include all federal programs that are active in OZ’s which will help communities and entrepreneurs and investors get the most out of their investment.

Second, the Treasury Department has released its long-awaited installment of proposed regulations. The 169-page document provides further details and updates for both fund sponsors and managers, as well as taxpayers. They are recommending the following to be approved for the second round of guidelines:

  • When a test date comes up for a fund, an investor can exclude cash/cash equivalents if they have been received within 6 months of the test date. This will allow investors the time needed to decide what to do with the cash/equivalent.
  • OZ Property Clarity
    • Land used in trade or business/ leased property can count as a “good or asset”
    • Simple valuation techniques for business property
      • Unadjusted cost basis for purchased property or present value of lease payments for leased property
    • Provide clarification on the provision that all property must be in a zone and what the original use of property means.
    • Providing different measurement options for “active conduct”
      • This would be measuring services performed by hours or amount paid for services in addition to a clause that states that other circumstances will be considered
    • Working capital can be trade or business and not just tangible property
    • Allowing overlap of working capital deployments
      • Each one will need a written plan and a realistic schedule
        • This will provide investors with certainty as to how they can use funds that are committed but not yet deployed as working capital
      • Offering an extension when a project using working capital is delayed due to government processes like permitting causing issues
      • Qualified OZ interest that is deeded through inheritance will keep the tax benefit, essentially eliminating the death tax.

This update is good news for both investors and the community. The original Opportunity Zone legislation lacked a lot of details, and the first round of guidance in October 2018 created more questions than it answered.

Altogether, there are seven Opportunity Zones in Salt Lake City: Salt Lake City/Magna (NWQ), Glendale area, Fairpark, Poplar Grove area, Granary and Downtown, Depot and Downtown, and Salt Lake City/West Valley City (directly South of the airport, East of NWQ).

Have questions about Salt Lake City’s Opportunity Zones? We’re here to help.  Give us a call at (801) 535-7200 or email: