Ohio Opportunity Zones Tax Credit Program
January 2023 Application Round
Welcome to the Ohio Opportunity Zone Tax Credit Application.
Applications are currently closed.
Applicant Taxpayers may consult the Ohio Opportunity Zone Tax Credit Guidelines and program FAQs found on the program’s webpage for a comprehensive program review.
Application instructions are available and accessible on the first page of the Ohio Opportunity Zone Tax Credit Application. Development strongly encourages Applicant Taxpayers to print out and read the instructions prior to completing the application.
A complete application submittal includes:
- Taxpayer’s Ohio Opportunity Zone Tax Credit Application;
- Taxpayer’s documentation verifying Investment(s) into the Fund(s);
- Fund’s documentation verifying Investment(s) to the Property Owner;
- Form A (Ohio Qualified Opportunity Fund Certification); and
- Form B (Qualified Opportunity Zone Property Owner Certification).
Form A and Form B can be accessed on the first page of the Ohio Opportunity Zone Tax Credit Application.
Each submitted application will be recorded at the date and time of its submittal, and applications will be reviewed in order, beginning with the first application submittal. If an application is determined to be ineligible, it will be removed from the application queue.
Please Note: The correct applicant for the OH Opportunity Zone Tax Credit Program Application is the entity that directly made the capital investment into the Ohio Qualified Opportunity Fund (“Fund”). Simply put, whomever owns the bank account or investment fund that was used to provide the investment capital to the Fund must be the applicant. If it is determined that the applicant is incorrect based on the capital investment source, the application will be considered ineligible and removed from consideration. If a new application for the investment is then filed with the correct applicant, it will be reviewed in the order it was received and will not replace the ineligible application’s position in the queue.
A Few Opportunity Zone Facts
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.
- 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.
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 $2 million dollars during the 2022-2023 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 2022-2023 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
Applications are currently closed.
Taxpayers that have invested in an Ohio QOF must apply directly to the Ohio Department of Development ("Development") for the tax credit during the established application period, occurring annually in January. The application will be available through Development’s application web 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 allocated in the biennium is fully utilized – whichever comes first.