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Opportunity Zones

Originally established by Congress through the Tax Cuts and Jobs Act (TCJA) of 2017, the Federal Opportunity Zones Program was made permanent with the passage of the One Big Beautiful Bill Act (OBBBA) of 2025. The purpose of the program is to promote investment and drive economic growth in low-income and/or economically disadvantaged communities.

Program Description:

The OBBBA authorized the governor of each U.S. state and territory to nominate a certain number of qualifying census tracts as “Opportunity Zones.”

Investments made through certified investment vehicles created as “Opportunity Funds” are used to spur economic growth in designated Zones — for example, by supporting new businesses or real estate development. Parties who invest in Opportunity Funds can benefit from tax incentives, such as deferrals on capital gains tax. An Opportunity Fund may be organized as a corporation or partnership whose assets comprise at least 90% qualified Opportunity Zone assets, representing an investment in Opportunity Zones.

Distinct from the original provisions in the TJCA, the OBBBA provides higher tax incentives and lower investment hurdles for rural census tracts compared to non-rural tracts through Qualified Rural Opportunity Funds. This distinction encourages greater utilization of the Opportunity Zone program in rural areas of Nebraska and the country.

By driving capital investment and generating economic opportunities, the Opportunity Zones Program benefits individuals, communities, and states. In addition, certain investments made by U.S. investors, e.g., the reinvestment of unrealized capital gains into Opportunity Funds, may benefit from favorable tax treatment and incentives, such as temporary deferrals. For additional information about Opportunity Zones visit https://www.irs.gov/credits-deductions/businesses/opportunity-zones.

How Will Nebraska’s Opportunity Zones Be Designated?

Under federal rules, each state is allowed to nominate as an Opportunity Zone (a) 25 eligible census tracts or (b) 25% of the total eligible census tracts within the state — whichever is greater. There is not a requirement for states to nominate all eligible census tracts. Census tracts eligible for nomination include those where:

• The tract poverty rate is at least 20%, or:
  • If located in a metropolitan area, the tract’s median family income does not exceed 70% of the median family income in the metropolitan area, or;
  • If located in a non-metropolitan area, the tract’s median family income does not exceed 70% of the statewide median family income.

A census tract that qualifies based on poverty rate must have a median family income below 125% that of the state or the census tract’s respective metro. The rule under the TCJA that allowed governors to designate census tracts that were contiguous to those which fit the above criteria as Opportunity Zones has been removed.

Under this formula, Nebraska has 112 eligible census tracts, equating to a maximum of 28 nominations.

Applications will be reviewed by DED, and recommendations will be referred to the Governor for review and approval. The U.S. Treasury Dept. will begin accepting Opportunity Zone nominations from governors on July 1, 2026, and continue for 90 days. Census tracts that are approved by the Treasury Dept. will be designated as Opportunity Zones beginning January 1, 2027. Opportunity Zones will be redesignated every 10 years.

Current Eligibility

Applications for Opportunity Zone nomination opened on March 2, 2026, and closed on Friday, May 1. DED is currently reviewing applications for recommendation to the governor. The final list of selected Opportunity Zones in Nebraska will be available following approval by the U.S. Treasury in the second half of 2026.

The interactive map below shows the 112 Nebraska census tracts that are eligible for Opportunity Zone nomination according to ACS 2020-2024 5-Year Estimates. For a full screen dashboard, click here. A list of the eligible census tracts is available here.

NOTE:

*Opportunity Zone investments are made at the sole discretion of Opportunity Zone investment funds and their investors. Opportunity Zone investments are not administered or overseen by DED. Individuals are advised to seek professional guidance when making tax-related decisions.

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