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Kingsport - Johnson City - Bristol The Tri-Cities area
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Old 11-03-2018, 11:13 AM
 
Location: Gray, TN
2,172 posts, read 4,625,586 times
Reputation: 931

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I'll try not to bore you with the details but the new tax law has a new way to avoid paying tax on investment capital gains if you are investing in an "Opportunity Zone" (a census tract defined as "low income"). We have several such tracts in the TRI. Most of DT JC seems to qualify. Basically, if you invest in an Opportunity Zone Fund and hold the investment for 10 years, you pay no tax when you sell.

Does anyone know if our local developers and local governments are using this generous provision to secure investment resources for our area?
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Old 11-05-2018, 06:27 AM
 
Location: TN/NC
35,075 posts, read 31,302,097 times
Reputation: 47539
It won't hurt. I have no idea if developers are using it.

I'll read the details if I have time this week, but there would have to be a market for whatever business it is first. I'd feel pretty confident that downtown JC will continue to thrive over the next ten years. If someone were giving me a tax incentive for a business there, as long as there was otherwise a market for it, it would be a nice bonus. It wouldn't make me start a business if I otherwise wouldn't.

I'd be more wary about tracts in Kingsport and Bristol. Both towns are economically behind Johnson City and their futures are more uncertain. I don't have a lot of faith that either city will be as well off in ten years as it is today, and markets that might be viable there now may no longer be over a relatively short time period.
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Old 11-05-2018, 07:24 AM
 
Location: Gray, TN
2,172 posts, read 4,625,586 times
Reputation: 931
A somewhat hidden detail regarding O-Zone census tracts is that many of them include colleges/universities. That is because students have a very low median income compared to the general population. But I think we all know that universities are not a drag on a local economy, actually the opposite. Students at universities are usually not disadvantaged and usually, have some disposable funds to spend. So if I'm an investor, there's never been a better time to invest near ETSU.
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Old 11-08-2018, 07:19 AM
 
Location: Gray, TN
2,172 posts, read 4,625,586 times
Reputation: 931
Looks like the SBDC is on it... Maximizing the Impact of New Opportunity Zones

I'll be attending this event.
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