Compound is qualifying as an opportunity zone business (QOZ business). We will bring economic opportunities into the neighborhood where we are headquartered and provide investors in our company with compelling capital gains tax benefits.
The Opportunity Zone legislation is part of the Tax Cuts and Jobs Act of 2017 and was designed to spur long-term, patient private capital investment and job creation in eligible low-income areas. New York City has about 300 designated opportunity zones, including several in Manhattan. Companies that operate their business in a designated opportunity zone can qualify under the safe harbors outlined in the most recent guidance provided by the IRS about Opportunity Zones.Learn more about
Compound is working to improve the diversity and inclusion of the real estate landscape. As a part of our mission, our main headquarters will be located on Manhattan’s Lower East Side in a designated opportunity zone. We look forward to spending money in the neighborhood, patronizing local restaurants and other small businesses and recruiting local talent.
Over the next 5 years, we estimate that Compound will create over 100 skilled jobs and generate millions in revenue in the neighborhood where we locate.
Bringing jobs and capital into the area will lead to increased spending at local businesses and spur the local economy of the neighborhood.
Defer tax on capital gains (from selling stock, real estate, art, cryptocurrency, etc.) until Dec 2026.
Reduce the amount of tax on the original capital gains by up to 15%.
Eliminate any tax on all new capital gains if held for 10 years or more.
After selling an appreciated asset (it could be stocks, bonds, business, real estate, cryptocurrency, yacht, art etc.), an investor must invest the money gained through the sale into an opportunity fund within 180 days of the sale, or if the gain is from an investment in an LLC or LLP, from the end of the tax year of the entity. Investors will then elect to defer their gains at the time of filing their 2019 tax returns by filing form 8949.
The original capital gain can be divided into different qualified opportunity funds. Please consult a qualified tax advisor to see how this applies to your personal situation.