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Bezos Using Opportunity Zone Tax Breaks for Space Race with Musk

https://www.bloomberg.com/news/features/2020-12-09/elon-musk-jeff-bezos-use-opportunity-zone-tax-breaks-for-private-space-race

Excerpt:

The world’s two richest men, who committed billions of dollars of their own money to a private space race, are now eligible for an extra boost from the federal government: a tax break intended to help poor communities.

Jeff Bezos and Elon Musk had competed for nearly a decade to develop engines and rockets through their privately owned space companies when the perk came their way in 2018. Their companies’ sites were included among the thousands of tracts across the U.S. designated as Qualified Opportunity Zones, part of President Donald Trump’s plan to use tax breaks to attract investments and jobs to distressed neighborhoods.

At the time, Musk’s Space Exploration Technologies Corp. was building a launch operation along the Texas-Mexico border. Bezos’s Blue Origin had struck a deal to build a $200 million rocket engine plant in an Alabama research park. The companies had already committed to job creation and secured local tax breaks.

The billionaires’ qualification for the federal benefit, which hasn’t been previously reported, enables them to avoid capital gains taxes on money they steer into opportunity zone operations. Those investments can then grow tax-free, and if the billionaires keep their investments in place for a decade, any appreciation can be shielded from federal capital gains taxes forever.

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