Podcast: Estate Planning for Opportunity Funds

Vest COO John Zetterstrom sits down with Stephanie Alper-Lisi to discuss how opportunity zones can be strategically incorporated into estate planning.  

  1. Opportunity Zones are meant to incentivize investments in economically distressed areas by providing preferential tax treatment to individuals who can reinvest capital gains back into these areas

  2. Opp Funds have many moving parts in their structures  

  3. Deferral of tax on cap gains until 2026, meaning you have to hold said asset for 7 years minimum (if fund was created in 2019 )  

  4. If the holder of the investment dies before the 7 years pass the taxes are still owed and can potentially cost heirs

  5. Opportunity funds house the investments and you only earn the tax benefits IF the assets are kept in the fund for a number of years 

  6. You want to prevent heirs from liquidating the fund until the benefits are received 

  7. You want to provide heirs with a plan to pay the deferred tax outside of the opportunity fund. The best way we know how to fund that risk is through life insurance within an within an irrevocable life insurance trust which gives heirs liquidity to pay bills and other tax bills and keep all the benefits within the opportunity fund

Listen to the six-minute podcast here.