Opportunity Zones for Economic Development and Job Creation: The 'Nuts and Bolts' and a Look at Alabama

The Tax Cuts and Jobs Act of 2017 is the most recent federal government attempt to help economically distressed communities. It allowed for the creation of 8,764 designated “opportunity zones�? in July 2018 that cover parts of all 50 States, the District of Columbia and five U.S. territories. Investors who reinvest their capital gains through opportunity funds in opportunity zones receive significant federal tax benefits. The hope is that this incentive will spur new economic development and creating more jobs than otherwise would occur in distressed communities. In this paper, we describe the “nuts and bolts�? of opportunity zones created throughout the nation and assess some of the determinants in the selection of opportunity zones in the State of Alabama.