Parts of Cabarrus County have been included in opportunity zones designated by tax reform legislation signed into law last year and certified by the U.S. Treasury this week, opening a new source of investment capital and economic growth for places and people who need it most.
The Tax Cuts and Jobs Act created 252 opportunity zones across North Carolina’s 100 counties to spur investment, economic growth and jobs in economically disadvantaged, struggling and low-income communities throughout the country.
The zones provide a chance for U.S. investors to use a temporary capital gains referral in exchange for investing the capital in these communities. This will create new channels for investment that will grow jobs, inspire entrepreneurship and improve the local economy for future generations, proponents of the measure anticipate.
Both Concord and Kannapolis have areas designated as opportunity zones.
“In the period after the Great Recession, we saw that millions of Americans were left behind in the recovery due to job growth and economic opportunities being concentrated in select areas of the country,” said N.C. Sen. Thom Tillis. “There is nowhere more evident than North Carolina, as the rural and urban divide continues to grow and millions of North Carolinians are left behind. The creation of these opportunity zones in the tax reform legislation passed last year will incentivize critical investments in these communities in North Carolina and across the country so all Americans have economic opportunities no matter their location.”
Under the Tax Cuts and Jobs Act, states nominate low-income communities to be designated as Qualified Opportunity Zones, which are eligible for the tax benefit. Qualified Opportunity Zones retain this designation for 10 years. Investors can defer tax on any prior gains until no later than Dec. 31, 2026, so long as the gain is reinvested in a Qualified Opportunity Fund, an investment vehicle organized to make investments in Qualified Opportunity Zones.
"I’ve traveled across our state and heard and seen businesses expanding and creating new jobs, workers getting more money in their paychecks, and families seeing tax cuts—all because of the Tax Cuts and Jobs Act,” U.S. Rep. Richard Hudson said. “North Carolinians are optimistic, but there are some communities that still need help as the economy rebounds. This opportunity zone announcement is good news and yet another example of how tax reform is improving lives and revitalizing our communities.”
In April, North Carolina recommended all of these areas for federal consideration, and the U.S. Treasury on Friday, May 18, officially declared these low-income census tracts can participate in the investment program. Low-income census tracks are areas where the poverty rate is 20 percent or greater or family income is less than 80 percent of the area’s median income.
The 252 opportunity zones feature:
- A total population of more than 1.1 million North Carolinians;
- More than $580 million already invested in these areas, from both public and private sources, over the past five years;
- Nearly 45,000 families with children in poverty; and
- More than 50,000 business establishments.
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