Matthew Rappaport is a tax attorney advising investors about Opportunity Zone structuring and compliance. He is currently vice managing partner of Falcon Rappaport & Berkman PLLC, based in New York. 

“I enjoy working the industry because it’s the first time I ever had the opportunity to learn a topic right as it was coming into existence,” he said. “When I first became a tax attorney in 2011, it felt like I’d never get the chance to catch up to the established professionals. This was a brand-new frontier, and it’s been very exciting since 2018.”

How and why did you get involved in the OZ industry?

As a tax lawyer, I saw the value I could add right away. I jumped right into the space and made sure to learn everything I needed to know to advise clients properly. It’s been a great way to get in front of the right people.

What are some current trends you are seeing in the OZ market?

Single-asset funds are most successful, in my experience. For sponsors who have corralled the right deals, it’s a grand slam home run. Operating businesses don’t make up enough of the space, the way I see it. It’s equally good – if not better – for operating businesses, but for whatever reason, I haven’t seen as much capital flow into those.

How do you think the pandemic has impacted the OZ industry?

It hasn’t, as far as I see it. The capital has still been there, the activity has been stable, and OZ has been a good proposition even with COVID-19 ravaging the nation. The relief the IRS gave definitely helped.

What are your top business goals this year?

Continue to grow and develop the firm in general, and the tax department specifically.

What achievement in this market has been most rewarding for you? Why?

I’ve advised on some deals that are larger than the range we usually handle ($10-50 million), and that’s been a thrill. I’ve also been asked to do some choice speaking engagements, including OZ Expo, and that’s been excellent for overall business development.

What are your thoughts about increasing reporting requirements in the OZ space?

I’m for it. The current reporting requirements are not detailed enough for Treasury to get a full scope of both compliance and impact. They need this data to understand whether taxpayers are going about the program correctly (from a legal standpoint) and beneficially (from a societal standpoint). I think Treasury will be surprised how much positive economic activity has been steered into OZs because of the statute.

What are your thoughts on the proposed bill to extend the OZ program to December 2028 – the Opportunity Zones Extension Act?

I think it would be nice, but I think the program will be strong regardless of whether the act passes.

What do you think we can expect from the new Biden administration when it comes to OZs?

You can expect more stringent compliance reporting, possible impact study requirements, and possible re-drawing of the OZs (prospectively, not retroactively) based on the 2020 census.

What do you think Opportunity Zones can accomplish for distressed areas?

Development of multifamily housing, which is really important in the midst of the nationwide housing shortage, and the establishment of community businesses.

How would you like to change the OZ regulation? Why?

In the preamble to the final regulations, the IRS said they did not agree with my suggestion to allow QOFs to divide, and I have encountered over half-a-dozen real-life examples of why QOFs need to be able to divide. The other thing I would do is allow QOFs to contribute property to QOZBs while maintaining QOZBP status. 

What is your favorite quote and why?

There are many good ones to choose from, but I’ll go with the topical choice: “Tax Law is like the world’s biggest chess game with all sorts of weird conundrums about ethics and civics and consent of the governed built in. For me, it’s a bit like math. I have no talent for it but find it still erotically interesting.” That quote is from David Foster Wallace, whose unfinished epic The Pale King is about a tax lawyer at the IRS, although I have not yet read it.

What is the favorite book you have read recently? Why?

Man’s Search for Meaning by Viktor Frankl. I had it on my bucket list and finally got around to reading it. The experience was really moving.

What about you would surprise others? 

I have what I would consider to be an encyclopaedic knowledge of hip-hop music from the ‘80s and ‘90s. I listen to music from almost all genres, and folks would probably be shocked to see what’s on my Spotify lists, but I go incredibly deep on golden-era hip-hop.


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