Opportunity Zone Incentive

Montgomery, Alabama has 12 different census tracts designated as eligible for the Opportunity Zone tax incentive. These Opportunity Zone (“OZ”) areas are found throughout the city of Montgomery, meaning greater potential for a variety of types and sizes of projects.  All of Downtown Montgomery is in an Opportunity Zone.   

Whether you are looking for OZ eligible locations and projects in which to invest capital gains or whether you are a business/developer seeking to attract OZ funds, the most consistent advice staff shares is: This is a complicated incentive, so be certain to coordinate closely with a private accountant.

What is it?  

The OZ program is a way to defer capital gains tax; it was enacted as part of the 2017 federal tax reform package. In summary, it may allow an investor to defer capital gains taxes on the sale of an asset by investing those gains through a “Qualified Opportunity Fund.” The length of the deferral depends upon the timing of the sale. The OZ program may also reduce the original capital gains tax.  Some real estate projects and some active businesses may qualify to receive investments from Opportunity Funds. 

Are you looking at a specific location?

• Here is a basic map the City of Montgomery made of its 12 census tracts covered under this tax incentive: City of Montgomery Opportunity Zones    

  • Because the OZ incentive was rolled out as a way to help uplift economically distressed areas, here is a helpful map the City developed to show the reported vacancy and poverty rates of each of these tracts: City of Montgomery Opportunity Zones with Poverty Data                                                                                                                                                          

  • The Alabama Department of Economic and Community Affairs (“ADECA”) has an easy to use “look up tool” where you can simply plug in an Alabama address to check to see if it is in an OZ area. Check it out at: https://adecagis.alabama.gov/ozones/ 

Are you seeking basic information about the Opportunity Zone Incentive?

• Alabama Department of Economic and Community Affairs (“ADECA”) provides an overview of the program along with context information.  Here is their link: https://www.adeca.alabama.gov/Divisions/OpportunityZones/Pages/Opportunity-Zones.aspx

Are you trying to connect with investors and/or opportunities?

• All of Downtown Montgomery lies within an Opportunity Zone. For data on recent building permit investments, the largest recent projects, and downtown residential information, check out the information and reports on our Downtown Revitalization tab.

• For information about the variety of Downtown public places check out the new Public Placemaking GIS Story Map 

• In Montgomery, we are cooperating with a nonprofit called Opportunity Alabama.  You can learn more about them here:  http://opportunityalabama.com/

• Opportunity Alabama (“OPAL”) is a nonprofit that is connecting investors to “investable assets” in Alabama’s Opportunity Zones.  Among OPAL’s goals are to improve economic vitality and quality of life.  They may be able also to assess if your project qualifies in one of the two major categories of potential OZ opportunities: Real Estate and Active Businesses.  For more information, email Info@opportunityalabama.com.