New Opportunity Zone Legislation & Novogradac’s Upcoming OZ Summit, With Brent Parker & Jason Watkins

On September 27, new Opportunity Zone legislation was introduced into the House of Representatives. H.R. 5761 would extend and improve the tax incentive. If enacted before year-end, this legislation could have a huge impact for Opportunity Zone investors.

Plus, Novogradac is hosting their annual Opportunity Zones Summit on November 1, in Washington DC. Brent Parker and Jason Watkins of Novogradac join the show to preview the upcoming OZ Summit, and discuss the potential changes that the new legislation would have on OZs.

Episode Highlights

  • Breaking news about new Opportunity Zone reform and extension legislation, and what it would mean for Qualified Opportunity Fund investors if it passes by year-end.
  • OZ regulatory updates and priorities that still need resolution.
  • The latest update on fundraising by Opportunity Zone funds.
  • What an “Opportunity Zones 2.0” might look like if additional legislation gets enacted in 2025 or 2026.
  • A preview of the upcoming Novogradac 2023 Fall Opportunity Zones Summit.

Guests: Brent Parker & Jason Watkins

Featured On This Episode

About The Opportunity Zones Podcast

Hosted by OpportunityDb and WealthChannel founder Jimmy Atkinson, The Opportunity Zones Podcast features guest interviews from fund managers, advisors, policymakers, tax professionals, and other foremost experts in Opportunity Zones industry.

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Show Transcript

Jimmy: Welcome to the “Opportunity Zones Podcast.” I’m Jimmy Atkinson. On November 1st, Novogradac and company will be hosting the Novogradac 2023 Fall Opportunity Zone Summit in Washington, D.C. Here to discuss that upcoming event, as well as other Opportunity Zone industry updates, are Jason Watkins, principal at Novogradac, in Alpharetta, Georgia, and Brent Parker, partner at Novogradac in Long Beach, California. And Brent is also conference chair of the upcoming fall OZ Summit. Gentlemen, thanks for joining the show. It’s great to have both of you here today. Welcome.

Jason: Oh, really excited to be here, Jimmy. Thanks.

Brent: Thanks, Jimmy.


Jimmy: Absolutely, gentlemen. Brent, let’s turn to you first, just for a, kind of a big, high-level question. I’m sure a lot of my audience of high-net-worth investors, advisors, other Opportunity Zone stakeholders are likely pretty familiar with Novogradac. It’s a household name for those in the Opportunity Zones industry. But for anyone who may be new, or maybe a little bit unfamiliar, can you briefly explain what Novogradac and company is, and some of the services that the firm provides to the Opportunity Zone industry?

Brent: Sure. Sure, thanks. Yeah. You know, we’re a full-service CPA firm, also valuation, with a valuation component. You know, we provide, you know, anything from audits and tax return preparation, agreed-upon procedures engagements, which are obviously important to the Opportunity Zone industry, to, you know, consulting, and modeling projections. And then our valuation side can handle, you know, appraisal and valuation components as well. So, yeah, we’re, so, a full-service firm, take care of all of your sort of accounting and, you know, valuation needs.

Jimmy: And then, just to kind of promote your firm even a little bit more, I’m really impressed with all of the work that the Novogradac Opportunity Zones Working Group does as well. You guys have been in the Opportunity Zones industry since, well, honestly, since before it was an industry, right? You guys were very involved with the creation of the legislation and the regulations before it was even passed. Is that correct?

Jason: Yeah, that’s correct. And I co-lead that working group with John Sciarretti, and the working group started in 2017, I think, or, at least in early, I guess it was 2017. It was before the legislation even passed as part of the Tax Cuts And Jobs Act. And it’s been a collection of attorneys and other professionals, consultants, and Qualified Opportunity Funds, and businesses that have gotten together, many, many meetings now over the last five, six years, and I think we’ve really helped to establish a lot of sort of the standard accepted practices of how folks are doing in the industry. We’ve been, you know, very, I think, important, had an important role in reviewing the proposed regulations when those came out, and making comments and suggestions and modifications to those, to make the incentive work better, I guess you could say, and certainly in the initial rollout phases as well. So, I think we’ve been instrumental, and we’re still working. We’re still trying to make it better, we still get together monthly, and I think we’ve got some exciting projects underway right now, that hopefully we’ll continue to improve the incentive for everybody.

Jimmy: It’s incredible the work that the working group does. I try to join those monthly calls as often as I can. They’re invaluable. And there was some breaking news that came out of the last working group call, just earlier this week, and we’ll get to that in just a moment. But first, Jason, how would you characterize the overall current state of the Opportunity Zones industry? We’re more than five years in now. It’s no longer a brand-new program, but it’s still pretty new. How would you characterize the current state of it?

Jason: I agree. At times, I feel like it’s a maturing industry, but then I constantly read articles that are, “What are Opportunity Zones, and how can I use Opportunity Zones to defer a capital gain?” So, I feel like there are a lot of investors that are just now becoming aware of it. But we still have four years of investment, really, left, before the current program is scheduled to sunset. And so, I think there’s still plenty of time for folks to learn, and we’re all continuing our education process, I think, to make more folks aware of the incentive. As far as where it stands now, it’s been a tough year, I think. Sort of in a post-COVID environment. Interest rates are up. The stock market has been down, or at least flat, so there haven’t been as many capital gains, I think, that have been realized.

And so, because of that, there haven’t been as many capital gains to invest. And I think Brent’s gonna discuss some of the findings from our latest QOF survey that Novogradac publishes on a quarterly basis, later on during today’s podcast. But, you know, that’s sort of what we’re seeing. And we’re also, but, on the flip side of that, we’re seeing a lot of investors that have gotten comfortable with the incentive. And so, we’re seeing a lot of repeat investment. The same folks that are creating more gains, or at least utilizing capital gains that they’re having, to make second and third and fourth and fifth investments, and into new projects. And so, we’re still seeing a lot of activity. It’s not like this has completely dried up or anything. Activity’s down compared to a couple years ago, but I think a lot of that is more of an overall economic…the state of the economy, as much as anything else.

Jimmy: Yeah, I agree with you. Opportunity Zones, it has matured as an industry. In theory, investors should be more comfortable now, and there should be more capital coming in now than there was previously. But cyclically, the economy is just in a different position than it was a few years ago, and I think that’s provided an unfortunate headwind for all private markets, quite frankly, not just Opportunity Zones, but Opportunity Zones are equally affected. Let’s talk about the big topic on a lot of professionals’ minds, at least the types of people that I talk to, other Opportunity Zone professional investors, QOF fund managers, deal sponsors. They’re all clamoring for an update on, hey, what’s going on with legislation? Because currently, for those who are unaware, the Opportunity Zone tax incentive is set to sunset toward the end of 2026. You have to realize a capital gain by 2026 in order to participate in the program, and then it’s gonna end, you know, shortly after that time frame. So, there has been a lot of push from the industry to extend Opportunity Zones, and to reform it, in some ways, to make it better.


A lot of Opportunity Zone stakeholders were quite frankly frustrated that the reform and extension legislation that was introduced in the last session of Congress failed to progress. There was no new, big tax legislation at the end of last year, like we might have hoped and expected. But here’s the big breaking news. We are recording this on the morning of September 28th, and just within the last hour or so here, House Resolution 5761, just this morning was referred to the House Committee on Ways and Means, officially introduced to the House this week. Jason, I wanna get your take on that. What is the update here on this new reform legislation?

Jason: Great. And how exciting, right, that this is actually dropping minutes before we start recording?

Jimmy: Yeah. Great timing, by the way … recording this podcast, right?

Jason: I’m glad that Congress scheduled around this podcast. That was great. So, yeah, this is, basically, this is a reintroduction of the Opportunity Zones Transparency, Extension, and Improvement Act. This is what was introduced in both the House and the Senate. This the House version. They’re identical, but…or at least they were in the previous Congress, and we expect them to be, if and when the Senate version is introduced, we expect it to be the same. This is being introduced by Mike Kelly of Pennsylvania. Mike has been very instrumental, I think, as proponent of Opportunity Zones. He’s in the Erie, Pennsylvania, which, we all are, I think, pretty aware of how successful the OZ incentive has been in Erie. And so, Mike has, Representative Kelly, has introduced, reintroduced the “OZTEIA” we call it, and it’s expected to be largely the same as the previous version. There will be a few modifications we expect to see. The two-year extension will still be there. But most importantly, I think, the originally-introduced OZTEIA actually had a bit of a technical error, in that it did not extend the two-year extension to new investment. It was only extending it to previously-existing investments. And so, as part of a sort of a project between the Novogradac Opportunity Zones Working Group and Economic Innovation Group, we reviewed the legislation, and submitted back to the co-sponsors some recommendations, including this one, that make sure that the correct Internal Revenue Code section is referenced within the legislation, so that that two-year extension would apply to new investments, which is really what we wanted to see anyway.

And then there are a few other modifications that we had recommended. We had noted that in the previously-introduced legislation, there’s this expectation that certain higher-income census tracts will be sunsetted as Opportunity Zones. And the original legislation said that governors had the option to name, to nominate replacement census tracts, and we recommended that that be a requirement, so the census tract just wouldn’t go away and the incentive not be as powerful as it could be, so we did recommend that that be a requirement. We also wanted to make it a requirement that the governors, when they are nominating these replacement tracts, they are communicating with the local CEOs of the jurisdiction in which the census tract would be located. And another issue we saw with the legislation is that it was requiring…or, it was, for what census tracts would be eligible to be replacement tracts, there were to be up to 12 months of time could pass before regulations would be proposed to, that would determine what the criteria could be for a replacement tract. We recommended that that just be part of the legislation to begin with, so that we don’t have a 12-month wait while we’re waiting for regulations to be published, as we’re all familiar with the original legislation, it took two years to get the regulations finalized, so we didn’t wanna run into that again.

We also, as you recall from the original bill, there are some reporting requirements, because one of the big criticisms is there hasn’t really been a way to track the efficacy and success of the Opportunity Zones incentive, because the data was lacking. And so, there are a number of new data points that are going to be required to be reported under this, at both the QOF level, or at the investor level, and also at the QOF level, related to the underlying and ultimate use of the proceeds in these Opportunity Zones. And so, one of the data points that we thought should be added is the number of affordable housing units that are being developed, as well as the number of direct and indirect jobs that are being created with the investments. This would all be self-reported by, or at the fund level, but we thought those would be really good data points. They can help tell the story of Opportunity Zones, and how successful they’ve been in driving investment into these low-income areas, which was the, that was the intent to begin with. Drive investment. We’ve far exceeded, I think, the wildest expectations of how much investment would be driven in the Opportunity Zones to this point, even based on old data, which we don’t…I think, what, are we current through 2020 now, I think is where we really know what the IRS has, or what’s been reported to the IRS on tax forms. So, it’s still old data. It still wildly exceeds what we expected to see. And then…

Jimmy: Well, I was gonna say, we’ll talk about that data in a more detail in a few minutes here, but go on.

Jason: Sure. And then just a couple other things. There are some pretty sort of draconian penalties that were there for a failure to meet some of these information requests, some of these new requirements for information. And so, our comment there is to try to limit those, especially if they are de minimis or if they’re non-numerical in nature. And then lastly, there is a fund-of-funds provision that is in this, that would be very welcome, I think, to the industry. This will allow a QOF to hold an investment in another QOF. It would be required to be at a 95% threshold, as opposed to the current 90% assets test. So, a QOF that invests in another QOF would have to hold at least 95% of its assets in qualified. And our recommendation there was to make sure that it’s based on an average of two testing dates, similar to the current 90% test that everybody’s familiar with. So, that’s some of the changes, and there might be some more. There were other, sort of, more minor modifications that we had suggested, but that’s what we expect to see. And whenever the text is published, we’re just introduced today. Usually, the text follows a few days later, so we’ll be reviewing that when it comes out for, hopefully, all of our suggested modifications happened.

Jimmy: Very good. And yes, hopefully by the time this episode goes live next week, we will have that full text, and I’ll make sure I link to that from the show notes page for today’s episode. You can find those show notes at I’ll also link to my summary of the previous legislation that was introduced back in April of 2022. I have got a good summary of that bill up on our website. I’ll make sure that I pass that along on the show notes page as well, and hopefully I’ll be able to write another summary of this new bill pretty shortly here. Jason, how does this Opportunity Zone legislation fit into the broader context of congressional tax priorities, in a potential year-end bill? Because, you know, a lot of the stakeholders that I talk to, all they really care about is Opportunity Zones, Opportunity Zones, Opportunity Zones. “Hey, when are they gonna extend this thing?” and, you know, but looking at it from Congress’s point of view, this a very small piece of a very big and complicated puzzle. So, can you help us understand how this fits into the broader context?

Jason: Sure. I mean, as we’re recording this, there’s the looming government shutdown, which, that’s probably a little bit higher of a priority right now, but that’s what we’re looking at currently. That’s the current environment. So, there’s not really much going on, other than trying to resolve that issue, I think. But, you know, we feel that there is an appetite for some tax legislation, between the House Ways and Means Committee and the Senate Finance Committee. But, it’s that you gotta go across aisles. There’s gonna have to be some compromise to get anything. And we know that the Democrats are really focused on the expired child tax credit, trying to get that extended. We know that the Republicans are very concerned with some of the expiring provisions of the Trump tax cuts. So, we’re talking, like, R&D cost amortization, bonus depreciation, things like that. So, there’s gonna have to be a compromise. And if a compromise can be reached across those things, then we have the potential for some tax legislation that then some Opportunity Zones legislation could be inserted into. And, you know, potential timing, you know, maybe November, December. We really have to see how things progress at this point, since there’s such a big cloud right now over D.C. with the potential shutdown.

Jimmy: Well, fingers crossed we can get through the shutdown, and then hopefully toward year end, we do get some big tax legislation bill that Opportunity Zones can kind of hitch on to, so to speak. We’ll be tracking that very closely on this podcast and on our website, and I’m sure Novogradac will be tracking it on their Opportunity Zones Center as well. We’ll make sure we link to Novogradac’s Opportunity Zone Resource Center from our show notes page today, too. What about on the regulatory side? We just got done talking about legislation, but what about Treasury, the IRS, how they’re regulating Opportunity Zones? Final regulations have been in place now for a few years, but there’s always little tweaks here and there. Are there any priorities that you’re tracking on that side of things?

Jason: Absolutely. One of the big questions right now is around QOF decertifications. We get questions on a daily basis from QOFs that are wondering, “Well, how do I go about the process? My, deal didn’t make it. For whatever reason, I wanted to decertify my QOF, and I’d like to not have to pay a lot of penalties to do that.” And so, we’re getting questions all the time. That is an ongoing regulatory project. It’s included in the regulatory agenda currently, those QOF decertifications. Currently, I think December of ’23 is when the proposed timeline is for a notice of proposed rule-making around QOF decertification. But that’s been ongoing. It was, previously, I believe it was August of ’23, and before that, it was June of ’22. This has been an ongoing project, I think, for Treasury. There’s also the expectation that there will be final regulations, around the proposed regulations that were introduced, around foreign taxpayers, and that’s the same regulations that added the additional time regarding the working capital safe harbor stuff, around federally-declared disasters, that gave that some additional language in that.

So, we’re expecting that to be finalized. Currently, I think May of ’24 is when that is on the docket, for the schedule, but we’ll see if that updates. And, you know, there’ve been some other projects that the Opportunity Zones Working Group, sponsored by Novogradac, has been involved in. We’ve been trying to get more guidance around working capital safe harbor plans, and we submitted a letter this past year with a bunch of recommendations for how the working capital safe harbor plan, and the written schedules around that, could be modified to help it make more sense to investors. There’s this very strict sort of rule now, where the only way you can really change your working capital plan is that there’s a federally-declared disaster, which, yeah, those happen, but I think for general business reasons, there are lots of reasons that a working capital safe harbor plan may need to change. Business plans change. And so, we’ve been trying to get some additional guidance around that, and we’ll see, that, it’s been submitted, we’ve had acknowledgement from Treasury that they’ve received our recommendations, and we’ll see what happens.

Jimmy: Oh, very good. We’ll be tracking that as well. Brent, I wanna turn to you now, and give you a chance to take the stage here. We were discussing how the Opportunity Zone industry, Jason mentioned how Opportunity Zones has kind of exceeded expectations in terms of investment deployed into these different locations all over the country. Novogradac provides an incredible service to the industry, with its quarterly survey data updates. You guys are surveying over 1000 different QOFs now, on a rolling, voluntary basis, kind of an unofficial tally of what is taking place in the Opportunity Zones industry. What’s the latest update on the volume and pacing of capital-raising among the QOFs that Novogradac tracks?

Brent: That’s right. So, you know, as Jason sort of mentioned earlier, 2023, not as strong as, you know, 2022 and in prior years, but still healthy investment. Quarter two, latest information, quarter two, and we’re gonna have quarter three out pretty soon. But that, quarter two saw, of the funds we track, which is about a quarter to a third of all funds, I think a little over 1000 funds, like you said, there was $1.33 billion of investment in Q2 2023. For the year, a little over $2 billion. So, quarter one was pretty anemic, coming off of a strong 2022. But, you know, we’re hopeful that, you know, especially with new legislation being introduced, we’ll see, you know, some healthy investment when the year sort of starts to round out.

You know, within that, and that sort of brings the total invested, of the funds, again, that we track, to $36.1 billion. So, you know, like Jason said, I mean, just far beyond, like, you know, any expectations, I think, originally. And I think we’re seeing healthy investment in, geographically, throughout the country. You know, I think it’s actually leading in, sort of, California. Obviously, you know, it’s a bigger footprint, but Los Angeles in particular is sort of the leading city, which investment’s you know, found, by a healthy margin, which is interesting because, you know, there’s no … But, you know, multifamily continues to, and in particular, residential continues to sort of, you know, outpace other investments, followed by commercial, hospitality. You know, we’re seeing a lot of renewables, and especially lately, now, I think, as the, going back to what you were asking about earlier, and talking about sort of the trend of the industry, and, you know, how things are progressing, I think we’re seeing, at least personally, I’m seeing a lot of interesting sort of deals happening with master plans and everything being developed, that include, you know, these other tax credits, low-income housing tax credits, renewables, historics, you know, everything, sort of. I was just at a clients’, visiting several clients in Salt Lake City, and just, all types of great stuff happening there. So, I think, you know, there is a little bit of a downtick in the investment, so hopefully that starts to kind of pick up again, but I think there’s still a lot of development happening out there, and it’s continuing to sort of bloom. So, good stuff happening.

Jimmy: Yeah, I agree. Good stuff happening. Like I mentioned a few minutes earlier, some macroeconomic or cyclical headwinds that private markets, and Opportunity Zones specifically, for the purposes of this podcast, are kind of heading into, unfortunately. The fundraising or capital-raising volume down significantly year over year, from Q2 of last year to Q2 of this year, but it’s ticking back up from Q1 to Q2 of this year. You had a little bit of an uptick in the acceleration of capital-raising, and hopefully we see some good data from Q3, when that gets released here in a couple more weeks. We’ll see. But, a lot to consider, a lot we’re tracking here with the Opportunity Zones industry. Jason, wanna turn back to you now. We talked about the current legislation that just got introduced this morning. I wanna talk with you about what’s on the roadmap beyond this iteration of legislation, looking out to, you know, future years down the road here for Opportunity Zones. The Novogradac Opportunity Zone Working Group has put out some ideas for what could be thought of as an OZ 2.0. Can you share some of those high-level details of what a 2.0 version of Opportunity Zones might look like?

Jason: Sure. Be happy to. Yeah, we, our members have spent some time sort of brainstorming, yeah, if we had another bite at the apple. If we could redesign some of the aspects of the Opportunity Zone … what would we do? What could we do to drive even more investment into these lower-income areas? What could we do to maybe direct and focus investment on some necessary things, like job creation and affordable housing? What else could be done? So, first off, first and foremost, like you said, we’re looking out into the future at this point. Probably nothing that can happen even in this Congress. It’s very unlikely to be major tax legislation in an election year, 2024. We already talked about the challenges for 2023. So, the 118th Congress is probably not gonna have major tax legislation, so we’re going out to the next Congress at this point. So, we’re talking 119th Congress, so 2025-’26.

So, you know, first and foremost, we’d like to see permanence. That’s everybody’s wish. A two-year extension is great. We’d love to see permanence. I mean, clearly, this incentive works. It drives investment. So, in order to get that permanence, what can we do to sort of respond to some of the criticisms that the incentive has gotten, which is, well, it’s not creating affordable housing. Well, maybe we could expand the incentive to provide some additional benefits for investments that are sort of curated and targeted towards affordable housing and job creation. You know, we’ve discussed, you know, what would it take? What would the incentive need to be for an investor to maybe forego some of the return from market-rate housing, and maybe focus on affordable housing. And so, maybe, you know, we’re thinking along the lines of a 50% exclusion, rather than the maximum of 15% exclusion of capital gains. So, if you’re saying a capital gain that could be invested, if 50% of that was to be tax-free after a certain hold period, then perhaps that would be enough to focus investment and get investors more interested in some of the more impact-type investing. So, there would still be commensurate return for doing that type of investment, so it would encourage folks.

You know, with the permanence, we think there should be regularly-scheduled redesignations of Opportunity Zones. You know, we’ve talked to a lot of funds. We’ve talked a lot of other folks too, and we’re hearing that a lot of the more readily-available, easy-to-complete projects have been done in Opportunity Zones. And so we’re starting to run into an issue where it’s getting more and more difficult to locate a project that makes sense. So, maybe it’s time, or, at least within the next few years, it’s time to, let’s redesignate, and let’s get some new census tracts onto the list, in order to kind of start the process over, and drive new investment into other areas. As we know, only 25% of qualifying census tracts could be nominated, so there’s still 75% of census tracts that meet the criteria to be nominated as Opportunity Zones out there. So, maybe it’s time to consider redesignating.

And then, having a rolling six-year deferral period, we think, rather than this…you know, right now, and this is because of how the incentive had to be passed to begin with, but we had this hard, December 31st, 2026 deadline. And so, the closer we get to that, the fewer and fewer benefits there have been for investors. The 10% and 5%, that went away in 2021. So, we’ve lost a lot of that incentive to encourage investment, so we think, in a permanence-type setting…let’s just make it a six-year. So, if you hold your investment for six years, you qualify for the 15% tax-free portion of your originally deferred gain. Some other ideas we’ve had is extending the reinvestment rule to the QOZB level. So, a QOF, that receives proceeds back from an investment, they can reinvest it and continue to gain. But a QOZB can’t. If a QOZB sells property, it, the gain on the sale of that property, if it’s before a 10-year hold, is fully taxable. And that has really discouraged a lot of folks that don’t wanna necessarily hold on to the same investment for 10 years. If you gave a QOZB, at the QOZB level, gave them the ability to develop a property, sell it, take those proceeds, kind of like a 1031, at this point, right, take those proceeds, invest them into a new, and keep that deferral process going, I think you could greatly increase the amount of investment, because that 10-year hold is a long time. It’s a long time for real estate. It’s infinity for operating businesses. So, to give, we feel like, to give that ability to flip investments might attract more VC capital, at that point, and private equity, and operating businesses.

We have a lot of other ideas too. There’s a lot of issues around related party acquisitions that could be fixed, especially if the ultimate intent, which is to drive investment, and drive new capital into Opportunity Zones, if that’s the ultimate goal, then the fact that some small portion of an investment was acquired from a related party shouldn’t matter. And so, there’s some modifications that could be done to fix things like that, that would certainly bring many, many more potential projects into the fold.

Jimmy: Well, I think that is the goal at the end of the day. Let’s get more private capital invested in these under-invested areas that the whole point of Opportunity Zones in the first place. So, 1.0’s pretty good. It’s got some flaws. The incentives have expired. Some of the incentives have expired permanently. Some of them are going to expire by the end of 2026 if Congress doesn’t take action. So, we’ve got two big pieces, big two big moving pieces right now. One is this initial reform and extension legislation that we’re, fingers crossed, hoping gets passed by the end of this year, and then Jason was just recapping their vision for the next version of Opportunity Zones, Opportunity Zones 2.0, which would get packaged into some sort of bill, probably in ’25 or ’26, in the next session of Congress, still a few years out.

But I love the ideas. I love the ambition of, you know, being able to say, hey, look, first of all, here’s the reporting on Opportunity Zones 1.0. This is clearly working. It’s driving capital investment, private capital investment, into these areas that typically have not received it. Here have been the benefits. Here’s been the economic activity in these areas. Here’s how it’s benefited the residents of these areas. Let’s make this bigger and better. Let’s improve the incentive. Let’s make it permanent. Fingers crossed this all works out. Time will tell, but I love that you guys have already roadmapped a lot of these ideas, so you can kind of hit the ground running once we put the presidential election behind us, once we get that new session of Congress seated, at the beginning of 2025.

Jason: One more big thing I forgot, that…

Jimmy: Yes, please.

Jason: …is we would like to see that when the taxpayer’s tax bill comes due on the deferred gain, we really feel like it needs to be at the rate, at the capital gains tax rate in place at the time they deferred the gain, because that is a huge unknown. And you never know how the winds in Washington are gonna go, and if capital gains tax rates suddenly shoot up, with a new administration, perhaps, in the, you know, ’24, whatever happens there, we don’t know. If capital gains rates increase greatly, then that could really effectively punish folks that invested into these low-income areas, by, they deferred a gain at 20%, and then they have to pay out at 37% or 39.6% or something. It would be terrible. So, we’d like to see that be part of any continuing permanency.

Jimmy: Absolutely. I love that idea, that, yeah, that would be a rather unpleasant tax bill that you find coming due in April of 2027. I suppose, increased capital gains, though, is a two-edge sword. It does kind of hurt you in April 2027, when you have to pay the deferred gain liability, but it makes the incentive overall more valuable, is what I tell people, because, hey, you get to…

Jason: Right. Exactly.

Jimmy: …exclude… Right?

Jason: Exactly. The higher the …

Jimmy: Yeah. I’m speaking your language.

Jason: …more value there is in deferring payment on it, so…

Jimmy: Exactly. Exactly. Well, let’s kind of wrap up our conversation today by discussing this upcoming Opportunity Zones conference. Brent, I’m gonna turn back to you. You’re the conference chair of the Novogradac 2023 Fall Opportunity Zone Summit, which is coming to Washington, D.C., The Park Hyatt, in Washington, D.C., on November 1st. Brent, what are you looking forward to the most, and what should attendees expect out of this conference?

Brent: I think the whole…it’s a one-day event. I think the whole day is just packed. It’s a great day. And I don’t know about you, Jason, but I’m really looking forward to the whole day. I think it’s, we’ve got a lot of, we’ve got all-star cast, a stacked lineup. We’re running from the opening address, and Washington Report, where, you know, we’re gonna hear the latest. Obviously, there’s gonna be a lot that happens before then. And so, we’ll hear everything that’s, you know, the latest at that point, and, you know, from the people that are sort of drafting and introducing these bills. So, from the horse’s mouth, so to speak. So, I’m really excited about the Washington Report. And then, you know, the next panel we have is gonna be our fund sponsors panel, which is called “QOF-y Talk.”

Jimmy: I love the title of that, by the way.

Brent: Yeah. It is in the afternoon, so, you know, it’s afternoon “QOF-y,” but, yeah, Jason’s actually moderating that panel, so you’ll hear Jason, and some fantastic fund sponsors, professionals, administrator JTC is gonna be on there, so, great stuff. And then, the last two panels of the day consist of a technical topics panel, which is gonna include all types of sort of … stuff that, you know, people are facing, you know, such as, sort of, 1031 exchanges, regulatory compliance, etc. And then, a hot topics panel, which is going to get into sort of various developing, like, investor trends, issues related to, sort of, emerging investment activity, one of which I think they’re gonna talk about the clean energy and efficient building provisions of the Inflation Reduction Act, which is massive, and so, I think we’re gonna see, we’re seeing a lot of synergy already between the incentive and that.

And then, you know, of course, not to ignore the…it’s gonna be followed by a mixer, so y’all get together, have some drinks, and talk about the day. And then, actually, what’s cool about this is the next two days, we’re gonna have our renewable energy tax credit conference in the same hotel, on the 2nd and 3rd. So, you know, stick around for that. There’s gonna be all types of people to talk to, you know, various levels of, various different stakeholders, fund sponsors. We’re gonna see, you know, just all types of different stakeholders. And so, I think it’s really exciting. I’m excited about the whole thing, and I’m staying through, you know, through Friday. So, I definitely urge everybody to check that out.

Jimmy: No, that’s great. Like I always say, come for Opportunity Zones, stay for renewable energy tax credits. I don’t know if I always say that, but I’ll say it in this circumstance. I’m really looking forward to the conference. I’m gonna be there. So, if, I would say, if you are any sort of Opportunity Zone stakeholder, whether you’re a CPA, or an attorney, or you’re a Qualified Opportunity Fund manager, maybe you’re a real estate developer, or a deal sponsor, maybe you’re an investor or an advisor. If you’re interested in learning more about Opportunity Zones, or networking with some of the most important people and most influential people in the industry, I highly recommend the Novogradac conference. I never miss one of these. I’m really looking forward to it. OpportunityDb is a media partner with Novogradac on this event. We do have a special coupon code that I can share with you, if you wanna save 10%. My podcast listeners can save 10% by entering OPPORTUNITYDB10, that’s OPPORTUNITYDB 1-0, at checkout, when you go purchase your conference tickets. And, I mean, best part, you get to meet the three of us there, and a lot of other professionals in the industry. It’s a really good time.

The hot topics panel, you’re saving that one for last. That sounds like an interesting one. That’s, like, the dessert for the day, I would say. And then you get your cocktail hour right after that. And then, I don’t know. I might have to round up some people and take them out to dinner that night as well. I’m really looking forward to it. Gentlemen, thank you both so much today for coming on the show and sharing your insights on legislation, on regulatory updates. Again, great timing, with the breaking news about that bill being introduced just within the last couple of hours here. We’ll be talking a lot more about that on this show in future episodes. I’m sure there will be plenty of discussion on that legislation at the Novogradac Conference in Washington, D.C., on November 1st. Before we go, can you tell our audience where they can go to learn more about Novogradac and the upcoming event?

Brent: Yeah. So, you know, go to,, and all types of information there. Yeah. Check it out.

Jimmy: Perfect. And I’ll make sure to link to I’ll also link to their Opportunity Zone Resource Center. It’s great. It’s packed with tons of information and regular updates. And I’ll also link directly to where you can buy tickets for the upcoming conference, and again, that coupon code you can use is OPPORTUNITYDB10. My podcast listeners can save 10%. Thank you to Novogradac for providing me with the opportunity to share that with my listeners.

And for our listeners, and viewers, of course, as always, we’ll have show notes available for today’s episode. You can find those show notes at I’ll have links to all of the resources that Jason, Brent, and I discussed on today’s episode, and please be sure to also subscribe to us on YouTube, or your favorite podcast listening platform, to always get the latest episodes. Jason and Brent, it’s been a pleasure. Thanks again so much for joining me today, and I’ll see you November 1st in D.C.

Brent: Thanks, Jimmy.

Jason: Thanks, Jimmy. My pleasure.

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