What does it mean for Opportunity Zone investors and QOFs in New York after the state’s senate voted to end the program?

Answers

• 

  Matthew Rappaport

  Falcon Rappaport & Berkman

  May 30, 2022

  The bill still requires approval from the Assembly (the New York equivalent of the federal House of Representatives) and a signature from Governor Kathy Hochul to become law. Therefore, the bill does not have any current effect on treatment of OZ investments under New York law. If the bill gets passed, instead of having pre-2021 OZ investments "grandfathered in", as is the case now, ALL OZ projects will lose preferential tax treatment under New York law. Federal benefits would still be available because New York State has no jurisdiction to influence federal tax treatment.

• 

  Marko Belej

  Taft

  May 26, 2022

  Nothing, until the bill actually becomes law. But even then, federal opportunity zone (OZ) benefits will not be affected; this bill would only deny OZ benefits for New York state purposes (effectively, "decoupling" the New York state tax code from the Internal Revenue Code in this respect).

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