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News & Press: Sacramento Report

Governor Newsom Looks at Federal Opportunity Zones for Affordable Housing

Tuesday, April 16, 2019  
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The federal tax overhaul passed in 2017 created a program for opportunity zones that lets investors shield gains from taxes if they invest in projects in designated opportunity zones. Governor Newsom, speaking at the Opportunity Zone Investment Summit at Stanford University, noted that the zones could help attract California investment in a state with one of the highest tax rates. He also focused on affordable housing as one such investment.

California has 879 opportunity zones. An investment held in an opportunity zone for 10 years escapes all federal, but not state, taxes on gains. Speaking at Stanford, Governor Newsom suggested focusing on housing affordability and climate change as investments. However, there is a question of whether the California Legislature will enact legislation conforming to the federal law on opportunity zones in order to create state tax incentives. It’s unclear yet whether the Governor will press for state tax changes that target affordable housing investments in opportunity zones.

California Land Title Association

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