Real Estate Attorney Joseph McCarthy on PSBJ ‘Thought Leader Forum’ Panel on Opportunity Zones

Real estate development attorney Joseph McCarthy is quoted in the Puget Sound Business Journal in an article titled “Thought Leader Forum: Opportunity Zones,” published June 28, 2019. McCarthy was part of a panel that discussed the Opportunity Zones (OZ) program, which was created by the Tax Cuts and Jobs Act of 2017 as a tool that provides certain tax benefits to investors to spur economic development and create jobs in economically distressed communities.

The panelists discussed:

• The ramifications of participating in the OZ program, failure of an OZ business, and an early exit from the program.
• The relative importance of tax benefits and profitability.
• Potential changes to the program.

Finally, the moderator asked the panelists for advice for an investor considering entering the program. The panelists stressed the need for hiring an accounting firm familiar with the OZ legislation and legal counsel fully cognizant of the tax and real estate aspects of the investment.

While the panelists generally agreed that the OZ program is a great opportunity for investors, McCarthy ended on a slightly cautionary note: “The juice that you’re going to get from the tax benefits is only a couple of basis points, it’s not going to save a bad project. Also, you really need to associate yourself with best-in-class partners, people who are experienced in what they’re doing and have integrity, as well as understand this program.”