In our last post, we talked about economic zones, what they are and why they exist. In some cases, there are special incentives for investments and these zones may be a good place to find real estate investment opportunities.
Here are a few examples of different types of economic zones in the United States:
Foreign Trade Zones (FTZs)
FTZs are secure areas within the United States that are considered outside of U.S. customs territory. Businesses operating in FTZs are able to defer or eliminate U.S. customs duties on goods that are imported into the zone and then exported out of the zone or entered into the U.S. market. There are currently over 200 FTZs located in the United States.
Empowerment Zones are designated areas within urban and rural communities that are eligible for tax incentives, grants, and other federal funding to encourage economic development. There were originally nine Empowerment Zones designated by the federal government, but the program has since ended.
Opportunity Zones were created by the Tax Cuts and Jobs Act of 2017 to encourage investment in economically distressed areas. Investors who invest in designated Opportunity Zones can receive tax benefits, including temporary deferral of capital gains taxes and potential elimination of capital gains taxes on investments held for a certain period of time.
Enterprise Zones are state-specific economic development programs that offer tax incentives, regulatory relief, and other benefits to businesses operating within designated zones. Each state has its own set of Enterprise Zone programs, and the rules and incentives can vary widely.
Each program has its own set of rules and benefits, and businesses operating in these zones may be able to take advantage of tax breaks, regulatory relief, and other incentives to support their operations and growth.
In our next post, we’ll talk about where there are different economic zones in the United States.
In the meantime, we invite you to create your own economic zone by learning how to invest in real estate! Coach Brian Gormley has created several options for your training, such as private coaching and the real estate masterclass. Get started today!