Opportunity Zones (OZ)
Share your recommendations by June 23, 2026, through this form for the next round of Opportunity Zones!
OZ Background
Federal Opportunity Zones are an economic development tool for designated Rhode Island communities to attract private investment. The program provides federal capital gains tax incentives designed to steer private capital into low-income census tracts for long-term investment and economic revitalization. Opportunity Zone investors can potentially receive the following capital gains tax incentives: deferral of capital gains tax, a step up in basis on their investment, and tax exclusion.
These investments have the potential to support business expansion and real estate development; promote synergy with state and local efforts; and support the needs of local communities.
OZ 1.0
Active: July 2018 - December 2028
The first round of Rhode Island Opportunity Zones consists of 25 census tracts which were designated in 2018 (also known as Opportunity Zones 1.0). These designations will expire on December 31, 2028.
View the IRS Notice 2018-48 for a list of Rhode Island Opportunity Zones 1.0.
To determine if a property address is located within the boundaries of an Opportunity Zone, view the U.S. Department of Housing and Urban Development Map.
OZ 2.0
Active: January 2027 - December 2036
On October 28, 2026, Rhode Island nominated 25 census tracts to the U.S. Department of Treasury to be designated as the newest Opportunity Zones (also known as Opportunity Zones 2.0). Final designations are subject to review and certification by the U.S. Department of the Treasury. The new designations are scheduled to take effect on January 1, 2027 and continue for a 10-year period running through December 31, 2036.
View the list of nominated Rhode Island Opportunity Zones 2.0 census tracts below.
| Central Falls | 44007010800 |
| Central Falls | 44007010900 |
| Central Falls | 44007011100 |
| Cranston | 44007013701 |
| Cranston | 44007014100 |
| East Providence | 44007010200 |
| Narragansett | 44009051504 |
| Newport | 44005040500 |
| Newport | 44005041200 |
| Pawtucket | 44007015100 |
| Pawtucket | 44007015200 |
| Pawtucket | 44007016700 |
| Pawtucket | 44007016100 |
| Providence | 44007000800 |
| Providence | 44007002500 |
| Providence | 44007001900 |
| Providence | 44007000700 |
| Providence | 44007000101 |
| Providence | 44007000600 |
| Providence | 44007001601 |
| Warwick | 44003021700 |
| Woonsocket | 44007018000 |
| Woonsocket | 44007017900 |
| Woonsocket | 44007018300 |
| Woonsocket | 44007018100 |
Additional Background: OZ 2.0
Passed into federal law in July 2025, Public Law 119-21 made the Opportunity Zone program permanent but revised eligibility and requires a new nomination process. Revised eligibility criteria include a lower median family income threshold and elimination of contiguous tracts. Among other additional changes, investments in qualified rural areas will receive a 30% basis step-up after five years compared to the standard 10% for non-rural investments.
As part of the Opportunity Zone 2.0 nomination process, Commerce gathered feedback from state municipalities and community stakeholders to develop the principles that would guide the identification of potential OZs in Rhode Island. These principles are investment attractiveness/market readiness, community need, and alignment with state and local policy goals. Commerce also launched a website page to provide OZ 2.0 details and solicited input from municipalities and stakeholders on census tracts to consider for nomination.
How Do Opportunity Zones Work?
Investment in Opportunity Zones occurs through Qualified Opportunity Funds. Under the 2025 legislation, investors are eligible to take advantage of certain benefits on the taxation of their capital gains to include:
- Deferral: Capital gains that are invested in Qualified Opportunity Funds may temporarily defer capital gains taxation for five years on a rolling basis.
- Reduction in capital gains tax for long-term investments: Capital gains that are invested in Qualified Opportunity Funds for at least five years may step up its basis by 10%. Investments in qualified rural zones can see a 30% step up in basis.
- Exclusion of capital gains tax on appreciation of investments: Capital gains resulting from appreciation of Opportunity Fund investments are excluded from taxation if the original investment is held for at least ten years.
Additional Opportunity Zone information can be found at:
- OZ 1.0 vs OZ 2.0 from the U.S. Department of Housing and Urban Development.
- OZ tax regulations from the U.S. Internal Revenue Service.
- OZ policies from the U.S. Department of the Treasury.
*For more information about the benefits of this investment, please consult a tax professional.
How Rhode Island Communities Can Leverage Opportunity Zone Designations
Communities with a designated OZ can leverage this opportunity by integrating the program’s benefits into its economic development and investment strategy. Questions to consider include:
- What kind(s) of private investment is the community seeking?
- How can the community aim to attract private investment?
- What potential barriers and opportunities may potential investors face (for example, local permitting, zoning, etc.)
- How can your community raise awareness and market the Opportunity Zone to private investors?
How can your community raise awareness and market the Opportunity Zone to private investors