Professor Michelle Layser was quoted in a May 1st Law360 article on opportunity zones. Opportunity zones offer investors a chance to defer or even eliminate taxation of capital gains if they invest in economically distressed areas designated in every state, the District of Columbia and five U.S. territories. Investors in states that have capital gains taxes and that begin their income tax calculation with federal AGI may get a double break, according to some experts. However, many lawmakers may not even be aware that their states conform with the opportunity zone provisions created under the 2017 Tax Cuts and Jobs Act. 

“Certainly the path of least resistance is just to continue to conform,” said Layser. “There is no real incentive for a state to fail to do so. Since so many states are conforming, I don’t think that alone would be a strong incentive to invest in any particular state,” but a lack of conformity could be a disincentive, she noted.

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