The 2027 Opportunity Zone Map: New Designations and Expiring Tracts

The calendar runs from July 1, 2026 to a January 1, 2027 start

Amended section 1400Z-1 sets a decennial determination date of July 1, 2026 and each July 1 ten years after the preceding one. The determination period is the 90 days that follow, and Rev. Proc. 2026-14 explains that a governor may ask for a 30-day extension, which pushes the nomination deadline to October 28, 2026 at the latest. Lists submitted early are treated as received at the end of the 90 days, so states could revise their nominations until the window closed, and the revenue procedure says any request to modify a nomination after October 28, 2026 will be denied.

Treasury then has a 30-day consideration period from the day it receives a list to certify the tracts and designate them, which ends November 27, 2026 for a list filed at the extended deadline; the revenue procedure notes that a further 30-day extension can take that to December 28, 2026. Under section 1400Z-1(e)(2) the designation starts on the January 1 following certification, so every tract certified in 2026 is a zone from January 1, 2027 to December 31, 2036.

Treasury is publishing the eligible list and a mapping tool, which the revenue procedure calls the Information Resource, with a flag for tracts comprised entirely of a rural area. The appendix to the revenue procedure is the authoritative list of eligible tracts.

The 70% income test replaces the old definition and drops contiguous tracts

The 2018 round borrowed the new markets tax credit definition of a low-income community from section 45D(e) and allowed a limited number of contiguous tracts that did not qualify on their own. Section 70421 of Public Law 119-21 replaced both. Under section 1400Z-1(c)(1) a tract outside a metropolitan area qualifies if its median family income is at or below 70% of the statewide median, or if it has a poverty rate of at least 20% and income at or below 125% of the statewide median; a metropolitan tract is measured against the metropolitan area median instead. Rev. Proc. 2026-14 confirms the contiguous-tract rule was removed for designations after July 4, 2025, so a tract now qualifies only on its own numbers.

The data set is the 2020-2024 American Community Survey five-year estimates, with 2020 Island Areas census data for the territories where survey data is not available, and the tract boundaries are the 2020 census boundaries, which the revenue procedure says are controlling for the whole designation period. A state may nominate a tract that is not on the published list if it supplies a tract-level analysis showing it meets the test.

The cap is unchanged in form but now applies per designation period: no more than 25% of a state's eligible tracts, rounded up, with a floor of 25 tracts for a state that has fewer than 100. The revenue procedure's own example is a state with 197 eligible tracts, which may designate 50. Notice 2026-40, section 3.01, adds that the 2018 designations do not count against the 2027 cap.

The 2018 zones expire on December 31, 2028, so two maps overlap for two years

Prior section 1400Z-1(f) kept a designation in force until the close of the tenth calendar year beginning on or after the designation date. Notice 2026-40, section 2.04(2)(c), applies that rule and states the result: the zones designated in 2018 remain zones through December 31, 2028, and the Puerto Rico tracts deemed designated on December 22, 2017 remain zones through December 31, 2027. A tract that was a 2018 zone can also be a 2027 zone, but Rev. Proc. 2026-14 says only if it meets the new income test on its own.

Expiry does not strip existing investors of the ten-year exclusion. Reg. section 1.1400Z2(c)-1(c) provides that the ability to make the election for investments held at least ten years is not impaired solely because a designation ceases to be in effect, for dispositions through December 31, 2047. What expiry does change is what a fund can buy, covered next.

Property bought after 2026 has to sit in a new zone unless a transition rule applies

For property acquired after December 31, 2026, amended section 1400Z-2(d)(2)(D)(i)(I) requires purchase after the zone's applicable start date, which is the January 1 after certification. Section 5 of Notice 2026-40 draws the consequence: a 2018 zone has no applicable start date, so tangible property bought after December 31, 2026 for use only in a 2018 zone cannot be qualified opportunity zone business property unless an exception applies.

The notice allows two. Property acquired under a written working capital safe harbor plan qualifies if the plan was adopted on or before December 31, 2026, the business had received at least 10% of the planned working capital and spent at least 5% by that date, and the purchases follow the plan; stock and partnership interests bought under such a plan are treated the same way. Second, property bought in the ordinary course to replace or modernize existing business assets in a 2018 zone still qualifies. Expansion of a business, or a move into a new line of business, does not.

Sponsors raising money in 2027 will therefore be deploying mainly into 2027 tracts, and anyone evaluating a fund should ask which tracts its pipeline sits in and when each was designated. QOF due diligence lists the questions, and the substantial improvement test explains what happens once the property is bought.

Timing for investors with 2026 gains: fund after January 1, 2027

The 180-day investment window in section 1400Z-2(a)(1) starts on the date the gain would be recognized, and under Notice 2026-40, section 4.02, a gain realized at any point in 2026 can be invested on or after January 1, 2027 and receive the five-year rolling deferral and the 10% or 30% basis step-up. An investment made on or before December 31, 2026 instead has its deferred gain included on the 2026 return, with no step-up and no second deferral.

A sale that closed in late June 2026 reaches the end of its 180 days around the turn of the year, so the funding date needs to be checked to the day. A sale in October 2026 has until the spring of 2027. The rolling five-year deferral and opportunity zones after the 2025 act cover what the 2027 investment then looks like, and 1031 versus an opportunity fund versus paying the tax compares the fund with an exchange for a real estate gain. Our opportunity zone fund page describes the funds we place clients in.