Ohio Opportunity Zones

2021 Application Round

The 2021 application round is now closed.

As a result of the Federal Tax Cut and Jobs Act of 2017, the State of Ohio worked with the U.S. Treasury to establish Ohio Opportunity Zones in 320 economically distressed census tracts among 73 of its counties. In 2019, the Ohio Amended Substitute House Bill No. 166 established the Ohio Opportunity Zone Tax Credit, which offers tax incentives for eligible investments in qualified projects located in Ohio Opportunity Zones.

For more information about Ohio Opportunity Zones, visit OpportunityZones.Ohio.Gov
  • Working with the U.S. Treasury, Ohio established 320 Opportunity Zones, its fully allowed allocation, throughout 73 of its 88 counties.
  • The zones were selected based on submissions by local government officials and nonprofit and economic development organizations.
  • Long-term investments in designated opportunity zones provide tax benefits for investors to maximize unrealized capital gains.
  • In Ohio, Opportunity Zones are available in large cities, small communities, and Appalachian counties.

 

Ohio Opportunity Zone Tax Credit Program

Overview

The Ohio Opportunity Zone Tax Credit Program provides an incentive for Taxpayers to invest in projects in economically distressed areas known as “Ohio Opportunity Zones”. These Ohio Opportunity Zones are qualified opportunity zones in this state designated by the Federal Statute 26 U.S.C. 1400Z-1 (an interactive map of the Ohio Opportunity Zones can be found at the bottom of this program section).

The Taxpayer invests cash in the Ohio Qualified Opportunity Fund (“Ohio QOF”), which in turn must invest that money in a Qualified Opportunity Zone property in Ohio. Once the money is invested in the Qualified Opportunity Zone property (“QOZ Property”), the Taxpayer is eligible for a non-refundable tax credit equal to 10% of the amount of its funds invested by the Ohio QOF in the QOZ Property. The Taxpayer may invest in multiple Ohio QOFs and may receive tax credits totaling up to $1 million dollars during the 2020-2021 biennium period.

The Ohio Opportunity Zone Tax Credit is applied to the individual income tax, as outlined in the Ohio Revised Code Section 5747.02. The tax credit may be claimed for the Taxpayer’s qualifying taxable year or the next consecutive taxable year. For the 2020-2021 biennium, a total of $50 million in tax credit allocation in available.

For Whom

Taxpayer eligibility requirements:

  • Be subject to the income tax levied under ORC Section 5747.02;
  • Make an investment in an Ohio QOF;
  • Ohio QOF invests all or a part the Taxpayer’s fund contribution in a QOZ Property in Ohio.

Ohio QOF eligibility requirements:

  • Be designated as a “Qualified Opportunity Fund” as defined by the Federal government in 26 U.S.C. 1400Z-2;
  • Hold 100% of its invested assets in a QOZ Property situation in an Ohio Opportunity Zone.

Benefits

  • Increased investment in economically distressed Ohio Opportunity Zones;
  • Increased business and housing development in Ohio Opportunity Zones;
  • Taxpayers reduce their individual income tax liability.

How to Apply

Taxpayers that have invested in an Ohio QOF must apply directly to the Ohio Development Services Agency ("Development") for the tax credit. Applications can be submitted between January 2, 2020 to January 31, 2020 for investments made by an Ohio QOF in QOZ Property in Ohio in calendar year 2019. The application will be available through Development’s application portal and must be filed electronically. Development will review the applications in the order they are received, issuing the tax credit certificate allocation until all eligible applications are funded OR the $50 million in tax credits is fully utilized – whichever comes first.

In the map below, the shaded areas indicate the federally designated Opportunity Zones in the state of Ohio.

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