FYI, great summary of a little known aspect of tax reform which allows investors to defer gains (and receive a 15% step up in basis) by rolling all or a portion of the gains into low income community funds, eg Qualified Opportunity Zones.
Introduction to Qualified Opportunity Zones
The new tax reform legislation, the Tax Cuts and Jobs Act (TCJA), created a significant new economic development tool alongside a meaningful tax deferral and abatement mechanism, “qualified opportunity zones.” The new provision provides a flexible deferral mechanism for short and long term capital gains for current investments in nearly all asset classes. Unlike Section 1031 “like-kind” deferral, qualified opportunity zones will provide: (i) the ability to invest only the gain rather than the full corpus of a current investment, (ii) a broader range of investments eligible for the deferral, (iii) a potential basis step-up of 15 percent or substantially more of the initial deferred amount of investment, and (iv) an opportunity to abate all taxation on capital gains post-investment. Read full article