Internal Revenue Code · 26 U.S.C.

§ 1400Z–1. Designation

In force Text current through Public Law 119-121 (October 9, 2026) release point 119-121

Official text, no changes From the Office of the Law Revision Counsel, release point 119-121 (current through Public Law 119-121 (October 9, 2026)). Compare it with the official text at uscode.house.gov (external site).

Cite as 26 U.S.C. § 1400Z–1

At a glance

Read from the text, the source credit and the official notes. Not part of the law.

Status: In force
Added: December 22, 2017 by Pub. L. 115–97
Last amended: July 4, 2025 by Pub. L. 119–21
Amendments: 2 dated changes in the source credit
Length: 5 subsections · 711 words · about 3 min to read
Defines: 7 terms
Cross-references: cites 0; cited by 0 Code sections and 2 other regulations

¶(a) Qualified opportunity zone defined

For the purposes of this subchapter, the term “qualified opportunity zone” means a population census tract that is a low-income community that is designated as a qualified opportunity zone.

¶(b) Designation

¶(1) In general For purposes of subsection (a), a population census tract that is a low-income community is designated as a qualified opportunity zone if—

¶(A) not later than the end of the determination period, the chief executive officer of the State in which the tract is located—

¶(i) nominates the tract for designation as a qualified opportunity zone, and

¶(ii) notifies the Secretary in writing of such nomination, and

¶(B) the Secretary certifies such nomination and designates such tract as a qualified opportunity zone before the end of the consideration period.

¶(2) Extension of periods

A chief executive officer of a State may request that the Secretary extend either the determination or consideration period, or both (determined without regard to this subparagraph),11 So in original. Probably should be “paragraph),”. for an additional 30 days.

¶(3) Special rule for Puerto Rico

Each population census tract in Puerto Rico that is a low-income community shall be deemed to be certified and designated as a qualified opportunity zone, effective on the date of the enactment of Public Law 115–97.

¶(c) Other definitions For purposes of this section—

¶(1) Low-income communities The term “low-income community” means any population census tract if—

¶(A) such population census tract has a median family income that—

¶(i) in the case of a population census tract not located within a metropolitan area, does not exceed 70 percent of the statewide median family income, or

¶(ii) in the case of a population census tract located within a metropolitan area, does not exceed 70 percent of the metropolitan area median family income, or

¶(B) such population census tract—

¶(i) has a poverty rate of at least 20 percent, and

¶(ii) has a median family income that—

¶(I) in the case of a population census tract not located within a metropolitan area, does not exceed 125 percent of the statewide median family income, or

¶(II) in the case of a population census tract located within a metropolitan area, does not exceed 125 percent of the metropolitan area median family income.

¶(2) Definition of periods

¶(A) Consideration period

The term “consideration period” means the 30-day period beginning on the date on which the Secretary receives notice under subsection (b)(1)(A)(ii), as extended under subsection (b)(2).

¶(B) Determination period

The term “determination period” means the 90-day period beginning on the decennial determination date, as extended under subsection (b)(2).

¶(C) Decennial determination date The term “decennial determination date” means—

¶(i) July 1, 2026, and

¶(ii) each July 1 of the year that is 10 years after the preceding decennial determination date under this subparagraph.

¶(3) State

For purposes of this section, the term “State” includes any possession of the United States.

¶(d) Number of designations

¶(1) In general

Except as provided by paragraph (2), the number of population census tracts in a State that may be designated as qualified opportunity zones under this section during any period may not exceed 25 percent of the number of low-income communities in the State.

¶(2) Exception

If the number of low-income communities in a State is less than 100, then a total of 25 of such tracts may be designated as qualified opportunity zones during any period.

¶(e) Period for which designation is in effect

¶(1) In general

A designation as a qualified opportunity zone shall remain in effect for the period beginning on the applicable start date and ending on the day before the date that is 10 years after the applicable start date.

¶(2) Applicable start date

For purposes of this section, the term “applicable start date” means, with respect to any qualified opportunity zone designated under this section, the January 1 following the date on which such qualified opportunity zone was certified and designated by the Secretary under subsection (b)(1)(B).

(Added Pub. L. 115–97, title I, § 13823(a), Dec. 22, 2017, 131 Stat. 2183; amended Pub. L. 115–123, div. D, title II, § 41115, Feb. 9, 2018, 132 Stat. 161; Pub. L. 119–21, title VII, § 70421(a)(1)–(4), (b)(1)–(3), July 4, 2025, 139 Stat. 223, 224.)

Terms defined here

Where the text says “the term … means”. Select a term to jump to its definition.

applicable start date § 1400Z–1(e)(2)
consideration period § 1400Z–1(c)(2)(A)
decennial determination date § 1400Z–1(c)(2)(C)
determination period § 1400Z–1(c)(2)(B)
low-income community § 1400Z–1(c)(1)
qualified opportunity zone § 1400Z–1(a)
State § 1400Z–1(c)(3)

Cross-references

Computed from the citations in the text of Title 26 and 26 CFR.

Cited in 2 regulations not issued under it

Amendment history

From the source credit and the official notes, newest first.

July 4, 2025Amended by Pub. L. 119–21Parts changed in 2025: (b)(3) (c) (c)(2)(B) (c)(2)(C) (d)(1) (d)(2) (e) (f)
February 9, 2018Amended by Pub. L. 115–123Parts changed in 2018: (b)(3) (d)(1)
December 22, 2017Added by Pub. L. 115–97

Where it sits in the Code

Nearby sections

§ 1400Z–1 Designation
§ 1400Z–2 Special rules for capital gains invested in opportunity zones

Official notes

Show the Law Revision Counsel's notes (amendments, effective dates)

Repeal of Subsection (b)(3)

Pub. L. 119–21, title VII, § 70421(a)(3), (5)(B), July 4, 2025, 139 Stat. 223, 224, provided that, effective on Dec. 31, 2026, subsection (b)(3) of this section is repealed.

Editorial Notes

References in Text

The date of the enactment of Public Law 115–97, referred to in subsec. (b)(3), is Dec. 22, 2017.

Amendments

2025—Subsec. (b)(3). Pub. L. 119–21, § 70421(a)(3), struck out par. (3). Text read as follows: “Each population census tract in Puerto Rico that is a low-income community shall be deemed to be certified and designated as a qualified opportunity zone, effective on the date of the enactment of Public Law 115–97.”

Subsec. (c). Pub. L. 119–21, § 70421(b)(1), substituted “For purposes of this section—” for “For purposes of this subsection—” in introductory provisions, added par. (1), and struck out former par. (1). Prior to amendment, text read as follows: “The term ‘low-income community’ has the same meaning as when used in section 45D(e).”

Subsec. (c)(2)(B). Pub. L. 119–21, § 70421(a)(1), substituted “beginning on the decennial determination date” for “beginning on the date of the enactment of the Tax Cuts and Jobs Act”.

Subsec. (c)(2)(C). Pub. L. 119–21, § 70421(a)(2), added subpar. (C).

Subsec. (d)(1). Pub. L. 119–21, § 70421(a)(4)(A), struck out “and subsection (b)(3)” after “by paragraph (2)” and inserted “during any period” after “the number of population census tracts in a State that may be designated as qualified opportunity zones under this section”.

Subsec. (d)(2). Pub. L. 119–21, § 70421(a)(4)(B), inserted “during any period” before period at end.

Subsec. (e). Pub. L. 119–21, § 70421(b)(3), amended subsec. (e) generally. Prior to amendment, text read as follows: “A designation as a qualified opportunity zone shall remain in effect for the period beginning on the date of the designation and ending at the close of the 10th calendar year beginning on or after such date of designation.”

Pub. L. 119–21, § 70421(b)(2), redesignated subsec. (f) as (e) and struck out former subsec. (e) which related to designation of tracts contiguous with low-income communities.

Subsec. (f). Pub. L. 119–21, § 70421(b)(2), redesignated subsec. (f) as (e).

2018—Subsec. (b)(3). Pub. L. 115–123, § 41115(a), added par. (3).

Subsec. (d)(1). Pub. L. 115–123, § 41115(b), inserted “and subsection (b)(3)” after “paragraph (2)”.

Effective Date of 2025 Amendment

Pub. L. 119–21, title VII, § 70421(a)(5), July 4, 2025, 139 Stat. 224, provided that:

“(A) In general.— Except as provided in subparagraph (B), the amendments made by this subsection [amending this section] shall take effect on the date of the enactment of this Act [July 4, 2025].

“(B) Puerto rico.— The amendment made by paragraph (3) [amending this section] shall take effect on December 31, 2026.”

Pub. L. 119–21, title VII, § 70421(b)(4), July 4, 2025, 139 Stat. 225, provided that: “The amendments made by this subsection [amending this section] shall apply to areas designated under section 1400Z-1 of the Internal Revenue Code of 1986 after the date of the enactment of this Act [July 4, 2025].”

Effective Date

Section effective on Dec. 22, 2017, see section 13823(d) of Pub. L. 115–97, set out as an Effective Date of 2017 Amendment note under section 1016 of this title.