Opportunity Zones & Capital Gains: Smart Tax Tips for Investors in 2025

If you’ve sold stocks, real estate, or other assets this year and made a profit, you’re probably wondering how to handle the capital gains tax that comes with it. One proven strategy savvy investors — including creators, small business owners, and online sellers — should know about is the Opportunity Zone program.

What Are Opportunity Zones?

Opportunity Zones are specific neighborhoods across the U.S. that the government wants to revitalize by attracting private investment. These areas often need more jobs, housing, or local businesses. To encourage this, the IRS offers special tax breaks for investors who put their money to work in these communities through a Qualified Opportunity Fund (QOF).

How Do They Work?

Here’s how it works:

• When you sell an asset (stocks, real estate, or even a business) for a profit, you usually owe capital gains tax.
• But if you reinvest that profit in a Qualified Opportunity Fund, you can delay paying taxes on that gain.
• The tax is deferred until you sell your QOF investment or until December 31, 2026, whichever comes first.
• If you hold your Opportunity Fund investment for 10 years or more, any new profit you make on that investment can be 100% tax-free when you sell it.

Example: How It Works

Do you know what to do if you’re a Los Angeles-based content creator with a growing YouTube channel and Shopify store?

Let’s say last year you sold some company stock you’d been holding for years and made a $200,000 profit. If you didn’t do anything special, you’d owe capital gains tax on that amount in the same year — and that’s a big chunk of money gone to the IRS.

Solution: Instead of paying taxes on the entire $200,000 right now, you could reinvest your gain in a Qualified Opportunity Fund that’s helping build new affordable housing in an underserved neighborhood in Downtown LA, for example.

✔ Tax deferred: You won’t owe taxes on your original $200,000 gain until December 31, 2026, or when you sell your Opportunity Fund shares — whichever comes first.

✔ Potentially tax-free new profit: If you keep your investment in the fund for 10 years, any new profit from the housing project won’t be taxed at all.

By using this smart strategy, you’re not only saving significantly on taxes — you’re also helping bring new housing and jobs to your local community.

What’s New for 2025?

As of July 2025:

• Long-term capital gains are still taxed at lower rates than short-term gains.
• There’s talk in Congress about possible rate changes for high earners, but no major federal changes have passed yet.
• The Opportunity Zone program is still in place, but remember — the deferral window ends after 2026, unless extended.

🔑 Tips for Smart Investors

Whether you’re a freelancer, entrepreneur, or business owner, here’s how to make the most of this strategy:

1️. Plan Ahead: The clock is ticking. Use this time to plan which gains you could reinvest to maximize your tax benefits.

2️. Choose the Right Fund: Only invest in a Qualified Opportunity Fund that meets IRS requirements. Do your homework or work with a trusted CPA for YouTubers, CPA for Shopify Store, CPA for Online Commerce, or CPA for Creators to find the best fit.

3️. Understand the Risk: Investing in Opportunity Zones often means putting money into real estate or new businesses — these investments can bring great returns and tax breaks, but they do carry risk.

4️. Work With a Pro: Every investor’s situation is unique. At Velin & Associates, Inc., we help clients in all industries — from Shopify Store CPAs, CPA for Filmmakers, CPA for Amazon Business, Amazon Business CPA, CPA for Dental Practice, Dentist CPA, and Dental Business CPA, to CPA for TikTokers, CPA for beauty salons, CPA for tradespeople, and CPA for equipment rental companies — build smart tax strategies that save money and align with long-term goals.

Let’s Talk About Your Capital Gains Strategy

Opportunity Zones can be a powerful tool to reduce or defer taxes and help local communities grow at the same time. But the deadline is near, so now is the time to plan.

For more information about our services, please visit our website.

Velin & Associates, Inc

8159 Santa Monica Blvd STE 198/200 West Hollywood, CA 90046
323-902-1000
dmitriy@losangelescpa.org