OZ deferral works for stock gains too, not just real estate. Rules got overhauled this year.

Quick one since the rules got rewritten recently and I see bad info on this regularly.

Opportunity Zones aren't a real estate program. They're a capital gains program. §1400Z-2 treats any realized capital gain as "eligible." Stocks, crypto, business sale, whatever. You've got 180 days from the sale date to roll the gain into a Qualified Opportunity Fund.

Three benefits stack:

1. Defer federal tax on the original gain for up to 5 years
2. 10% basis step-up at the 5 year mark (30% if it's a rural QOF, that part is new)
3. Hold the QOF 10+ years and any appreciation on it comes out federal-tax-free

That third one is where the actual money is. Roll $500K of stock gains into a QOF, it grows to $1.5M over ten years, you owe zero federal tax on the $1M of growth. That's an actual exclusion, not just deferral. Big difference.

Rules got rewritten last year. OBBBA (July 2025) made the program permanent and restructured it. IRS finalized eligibility with Rev. Proc. 2026-14 on April 6. Anything you read about OZs from before 2026 is stale.

Quick on what's different:

• Roughly 3x more tracts are eligible now, 25,332 vs 8,764
• Rural tracts get that 30% step-up I mentioned
• Old program had a hard December 31 2026 deferral deadline. That's gone, deferral is now rolling 5 years from whenever you invest
• Governors are nominating the 2.0 tracts July through September this year, designations go live January 1 2027

When it's worth doing for stock gains:

• Gain is over ~$100K. Below that the structuring costs eat the benefit
• You can leave the capital alone for 10+ years. If not, skip
• You're fine with the underlying being real estate. QOFs are almost all RE or RE-adjacent operating businesses

When it's not:

• Short horizon
• Small gain
• Low marginal bracket (deferral value shrinks)
• You don't want illiquid RE in your portfolio, which is reasonable

If you're going to actually look at this, get a CPA who's done OZ work before, not a generic W-2 CPA. And vet the QOF sponsor like any illiquid GP. The 10-year exclusion is only as valuable as the projects they actually pick. Plenty of 2018-era QOFs had duds.

Also, check that the specific tract you're interested in is actually eligible under the new rules before structuring anything. A lot of 2018-era eligible tracts dropped out.