Opportunity Zone

The Tax Cuts and Jobs Act of 2017 created a new class of private investment vehicles called Opportunity Funds to encourage capital investments in projects located in economically disadvantaged census tracts.  

These funds must be invested in the following:
  • Projects that are in census tracts designated as Opportunity Zones
  • Substantially all (90%) of the fund’s holdings must be invested in a Qualified Opportunity Fund (QOF).
The Town of St. Johnsbury is made up of two census tracts; #9574 & #9575. Both census tracts are Opportunity Zones (see below):

How Do Opportunity Zones Work?

  • What are the incentives for investors?
    • Temporary Deferral: An investor can defer capital gains taxes until 2026 by rolling their gains directly over into an Opportunity Fund
    • Reduction: The deferred capital gains liability is effectively reduced by 10% if the investment in the Opportunity Fund is held for 5 years and another 5% if held for 7 years
    • An Exemption: Any capital gains on subsequent investments made through an Opportunity Fund accrue tax-free as long as the investor stays invested in the fund for at least 10 years. 
  • What are the major components?
    • Investments: Opportunity Funds make equity investments in businesses and business property in Opportunity Zones.
    • Funds: Opportunity funds are investment vehicles organized as corporations or partnerships for the specific purpose of investing in qualified Opportunity Zones
    • Zones: States and territories designated 25 percent of their eligible low-income census tracts as Opportunity Zones. 

Investing in an Opportunity Zone

  • Who can invest?

    Investors can be anyone who:

    • has capital gains and 
    • has filed form 8949 with the IRS to set up an Opportunity Fund and 
    • complies with the deployment timing rules
  • What can they invest?

    (1) Qualified Opportunity Zone Operating Businesses which must have at least 50% of :

    • Employees
    • Sales
    • Property in Opportunity Zones

    (2) Qualified Opportunity Zone Property       which must have been 

    • sold or leased after December 2017
    • and be located within the zone. 

Public Service

Police Department Fire Department

Municipal Offices

Town Manager Town Clerk & Treasurer Selectboard Assessor's Office Planning and Zoning

St J Rec Department Facebook Page

Visit Us on Facebook
For more information about Opportunity Zones please contact The Town of St. Johnsbury Economic Development Office at (802) 748-3926 ext. 5 or jkasprzak@stjvt.com