The Treasury Department issued its second set of proposed regulations related to the new “Opportunity Zones” tax incentive created by the Tax Cuts and Jobs Act of 2017.

The program provides preferential tax treatment for investments made in Opportunity Zone Funds, including a temporary tax deferral of income from any capital gain and a permanent exclusion for income made from the sale of a fund investment. The White House predicts the initiative will spur $100 billion in private capital investment.

Treasury said the newly released guidance provides additional clarity and flexibility on requirements for the funds, the treatment of investment gains, and standards on business ownership and operation.

In a December comment letter, ICBA asked the IRS to work with bank regulators to identify how community banks can participate and invest in Opportunity Zone Funds.

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Read ICBA Comment Letter