Rex says
Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.
Try a scenario
Click to load — tweak from there.Inputs
Result
Tax saved on appreciation (10yr+ hold)
$69,535
QOF investment value at exit
$647,677
Deferred tax due (on original gain)
$60,000
Total appreciation earned
$347,677
Total benefit vs. taxable investment
$69,535
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How to use this
- 1Enter original capital gain invested into qof ($).
- 2Enter capital gains tax rate (%).
- 3Enter expected annual appreciation of qof investment (%).
- 4Enter years held in qof.
- 5Read your tax saved on appreciation (10yr+ hold) on the right — it updates as you type.
- 6Hit Share to keep the scenario or send it to someone.
About this calculator
Investing capital gains into a Qualified Opportunity Fund (QOF) within 180 days lets you defer tax on the original gain until the earlier of selling the QOF investment or a statutory deadline (December 31, 2026 under current law, though legislation has extended or modified these deadlines before, so confirm current rules). The bigger benefit for long-term holders is that any appreciation on the QOF investment itself — separate from the original deferred gain — becomes entirely tax-free if held for at least 10 years. This calculator estimates the deferred tax liability due at the deferral deadline, and separately projects the value of the 10-year exclusion by comparing the after-tax outcome of a straight taxable investment against a QOF investment growing at the same rate, isolating the tax-free appreciation as the incremental benefit. The original basis-step-up incentives for 5 and 7-year holds were tied to pre-2021 investment dates and have expired for most new investments, so this tool focuses on the deferral and the 10-year exclusion, which remain the live incentives for new capital deployed today.
Worked example
Using the values the calculator loads with:
Inputs
- Original capital gain invested into QOF: 300000 $
- Capital gains tax rate: 20 %
- Expected annual appreciation of QOF investment: 8 %
- Years held in QOF: 10
Results
- Tax saved on appreciation (10yr+ hold): $69,535
- QOF investment value at exit: $647,677
- Deferred tax due (on original gain): $60,000
- Total appreciation earned: $347,677
- Total benefit vs. taxable investment: $69,535
What each field means
Inputs
- Original capital gain invested into QOF ($)
- The original capital gain invested into qof used in the calculation, measured in $. Starts at 300000 $ so you have a working example on load.
- Capital gains tax rate (%)
- The capital gains tax rate used in the calculation, measured in %. Starts at 20 % so you have a working example on load. Accepted range: 0–37 %.
- Expected annual appreciation of QOF investment (%)
- The expected annual appreciation of qof investment used in the calculation, measured in %. Starts at 8 % so you have a working example on load. Accepted range: 0–25 %.
- Years held in QOF
- The years held in qof used in the calculation. Starts at 10 so you have a working example on load. Accepted range: 1–20.
Results
- Tax saved on appreciation (10yr+ hold)
- Returned as a money amount in US dollars and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- QOF investment value at exit
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Deferred tax due (on original gain)
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total appreciation earned
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total benefit vs. taxable investment
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
FAQ
When is the deferred tax actually due?
Under current law it's due upon sale of the QOF investment or December 31, 2026, whichever comes first — meaning most investors will owe this tax in 2026 or on their 2026 return regardless of whether they've sold, since that statutory deadline currently overrides the sale trigger for gains deferred well before then. Confirm current deadlines with a tax advisor since this has been subject to legislative change.
What happened to the 5 and 7-year basis step-up benefits?
Those partial basis step-ups (10% after 5 years, an additional 5% after 7 years) required investment before the end of 2019 and 2021 respectively to reach those holding milestones before the 2026 deferral deadline, so they're no longer available for new investments. The 10-year full exclusion on appreciation remains available for qualifying investments.
Does the fund need to be in a real Opportunity Zone?
Yes — Opportunity Zones are specific low-income census tracts designated under the 2017 tax law, and the fund must meet substantial investment and holding requirements within those zones. Verify a specific fund's QOF certification and zone eligibility with a securities and tax professional before investing, not just the sponsor's marketing materials.
Is the original gain eligible from any source?
Yes, generally — capital gains from stocks, business sales, or other real estate all qualify for OZ deferral, not just real estate gains, as long as they're properly invested into a QOF within the 180-day window from the date of the original gain.
Accuracy and limitations
- Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
- Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
- This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.
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Cite this calculator
Writing about this topic? Grab a citation — every link helps keep these tools free.
RevenueLab. (2026). Opportunity Zone Deferral Benefit Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/opportunity-zone-deferral-benefit
<p>Source: <a href="https://www.revenuelab.fyi/toolbox/opportunity-zone-deferral-benefit" target="_blank" rel="noopener">Opportunity Zone Deferral Benefit Calculator — RevenueLab</a> (2026).</p>
Source: [Opportunity Zone Deferral Benefit Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/opportunity-zone-deferral-benefit) (2026).