Treasury and the IRS have released new guidance explaining how states will nominate census tracts for designation as Qualified Opportunity Zones under the One, Big, Beautiful Bill. The law makes the Opportunity Zone incentive permanent, with the next round of designations taking effect January 1, 2027, and recurring every 10 years. It also creates additional tax benefits for investments in zones that are entirely rural.
The guidance identifies 25,332 eligible low-income census tracts nationwide, including 8,334 rural tracts. States may generally designate up to 25 percent of their eligible tracts, with special rules for states with smaller numbers of qualifying tracts. Governors will have a 90-day nomination window beginning July 1, 2026, with a possible 30-day extension, and Treasury will make the final designations after reviewing state submissions.
Treasury and the IRS also said more guidance is coming, and that online tools will be provided to help states complete the nomination process.
For Texas, this means the state will soon need to decide which eligible tracts it wants to prioritize for the 2027 designation cycle, including whether to focus more heavily on rural communities, distressed urban areas, or other locations where state leaders believe Opportunity Zone status could help attract investment.