The Department of the Treasury and the Internal Revenue Service issued Revenue Procedure 2026-14 providing guidance to the Chief Executive Officers of any State, the District of Columbia, and U.S. territories regarding the procedure for nominating population census tracts to be designated as Qualified Opportunity Zones (QOZs) under the One Big Beautiful Bill (OBBB). The nomination period opened on July 1, 2026 and will last 90 days, subject to a single 30-day extension. The first round of QOZ designations under the OBBB will take effect on January 1, 2027, with subsequent designation cycles every 10 years.
New Criteria and Rural Benefits
To be eligible for QOZ designation for 2027, a census tract must qualify as a low-income community (LIC). The OBBB makes the QOZ tax incentive permanent and adds tax benefits specific to investments made into QOZs that are comprised entirely of a rural area. According to Treasury and the IRS, there are 25,332 population census tracts qualifying as LICs eligible for nomination, of which 8,334 tracts are comprised entirely of a rural area.
Nomination Caps
The number of population census tracts in a State that may be designated as QOZs may not exceed 25 percent of the number of LICs in the State. If a State contains 25 to 99 LICs, then 25 eligible population census tracts may be designated. If a State contains fewer than 25 LICs, then all eligible population tracts within the State may be designated. The IRS release is IR-2026-45.
(Source tag: Internal Revenue Service Newsroom / Rev. Proc. 2026-14)