Structuring Opportunity Zone Investments for International Investors

Opportunity Zones as a Global Tax Strategy‍

Although Opportunity Zones were created to attract domestic capital to underserved U.S. communities, they are increasingly drawing interest from foreign nationals and global investors—particularly those with U.S.-sourced capital gains or exposure to U.S. situs assets. With the right structuring, international investors can participate in OZ projects and access the same tax advantages that apply to U.S. taxpayers.

Who Qualifies and How‍

Non-resident investors who generate U.S.-taxable capital gains—through real estate sales, business exits, or securities dispositions—can often qualify to reinvest those gains into a Qualified Opportunity Fund (QOF), assuming they meet the timing and character requirements under U.S. tax law.

However, without proper legal and tax planning, those same investors may be exposed to estate tax, compliance risks, or unintended consequences under FIRPTA, FATCA, or U.S. partnership rules. The solution is careful structuring.

Common Structures for Global Participation

Blocker Corporations:
Often organized as U.S. C-corporations (frequently in Delaware), blockers are used to limit the estate tax exposure of non-resident investors and manage U.S. tax filing obligations. These entities invest in QOFs and shield the individual investor from direct partnership reporting.

U.S. Trusts:
International families may use U.S.-based irrevocable trusts to participate in Opportunity Zone deals while insulating the assets from U.S. estate tax and creating continuity across generations.

Strategic Advisory Teams:
Successful cross-border OZ investing demands collaboration between U.S. tax counsel, international estate advisors, and OZ-specific fund managers. Coordination is essential to align treaty benefits, avoid withholding surprises, and ensure regulatory compliance.

“With the right structure, Opportunity Zone investments can become a global tax strategy—not just a domestic one. Sophisticated foreign investors are using these tools to mitigate U.S. capital gains exposure and build long-term footholds in U.S. real estate.”

Why This Matters for Global Investors‍

For investors abroad with exposure to U.S. assets, the Opportunity Zone program offers more than just a tax deferral—it provides an avenue for long-term U.S. capital deployment with significant tax benefits. When layered with proper structuring, it becomes a flexible, compliant, and tax-advantaged entry point into U.S. development markets.

‍