Trump's tax plan and Qualified Opportunity Zone changee

The landscape for Qualified Opportunity Zone (QOZ) investments has fundamentally shifted thanks to the One, Big, Beautiful Bill Act. This legislation not only makes the opportunity zone program permanent, it also introduces significant structural changes, enhanced reporting requirements, and new compliance penalties. The Joint Tax Committee estimates the OZ provisions will reduce federal revenues by $40.9 billion between 2025 and 2034, reflecting both the program's extension and enhanced rural incentives. The most important takeaway for practitioners: stricter compliance requirements take effect January 1, 2027, with penalties reaching up to $250,000 for large funds. Five Key Changes Reshaping Opportunity Zones Program Made Permanent with Decennial Redesignation The QOZ program is being made permanent while introducing a decennial redesignation process beginning July 1, 2026. Unlike the original program where states made one-time designations based on 2010 census data, QOZs must now be re-evaluated every 10 years using current economic conditions. Practitioner Impact: July 1, 2026 provides investors with 6 months advance notice before the January 1, 2027 effective date, eliminating the potential "dead zone" where QOF managers may be fundraising without knowing zone designations. Qualified Rural Opportunity Funds (QROFs) with Enhanced Benefits The OBBBA creates a new category called Qualified Rural Opportunity Funds (QROFs) for funds holding at least 90% of assets in qualified opportunity zone property located entirely within rural-designated QOZs. Rural areas are defined as locations with populations under 50,000 that are not adjacent to urbanized areas with populations in