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The passage of the Tax Cuts and Jobs Act passed in 2017 overhauled several cornerstones of the Internal Revenue Code and introduced new tax law, including section 1400Z-1 and section 1400Z-2 which address the qualified opportunity zones (QOZs). The business community, specifically real estate investors, has viewed the QOZ as a possible turbocharged vehicle to stimulate economic development in low-income communities throughout the United States. However, the impact of the new code sections has been hampered by key questions on how to apply the provisions.

The world economy is evolving and investors will need to adapt. We look at how the investment landscape is likely to evolve, against a background of continued economic growth but sustained uncertainty around China, Europe, and elsewhere. It makes sense to stay invested, but hedge, with market volatility creating opportunities as well as risks. Over the long term, we consider what a new structural cycle—the “new techonomy”—will mean for the next phase of global economic management.

The Department of Treasury and Internal Revenue Service has issued initial proposed regulations and instructions for investments in qualified opportunity funds (“QOF”), a program designed to incentive the reallocation of capital to designated low-income census tracts. This long-anticipated guidance is expected to allow investors, business owners, real estate developers, and fund managers to be able to confidently seize the powerful tax deferral, reduction, and exclusion benefits provided by the QOF program.

The Tax Cuts and Jobs Act of 2017 created new incentives for investment into certain communities throughout the United States that have been designated as Qualified Opportunity Zones (QOZs) by the U.S. Treasury Department. Investors can take advantage of the statute’s unique opportunity for deferral and exclusion of capital gains taxes by investing in designated distressed communities or QOZs. In doing so, it is important to know the mechanics of investing in QOZs via Qualified Opportunity Funds, along with the risks that come with the opportunity.

After a decade-long economic expansion and bull market in US stocks, investors are understandably nervous about downside risk. Global economic policy uncertainty rose sharply in 2018, fueled by the threat of a trade war among the world’s largest economies. With the stock market crash of 2008-’09 a distant but still painful memory, many investors are asking about efficient ways to protect their hard-won gains of the last decade. One of the primary tools that investors consider is the purchase of put options to protect their equity portfolios.