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.
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 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.