A tax break tucked into last year's One Big Beautiful Bill Act is set to take effect on January 1, potentially reshaping the economics of rural data center development. The law expands the existing opportunity zone program to include rural census tracts, making large-scale projects in those areas newly eligible for corporate tax benefits. According to research from the Searchlight Institute reviewed by WIRED, more than 100 data centers in various stages of development could qualify, and the actual number is likely higher since other datasets count nearly 1,500 planned or under-construction projects nationwide.
Experts caution that the incentive may not deliver the economic boost rural communities expect. "Right now, the only requirement to get the benefits is capital investment," said Emily Kraschel, a tax policy analyst at Searchlight. Unlike a traditional factory, data centers do not necessarily create many local jobs, so the tax break could enrich large companies without producing widespread benefits. Separate research from Pew found that while only 13 percent of operating data centers are in rural areas, about 67 percent of planned facilities are headed there, making the timing of the tax break significant.
Major technology companies are distancing themselves from the program. Microsoft, Meta, and Amazon all told WIRED they do not use opportunity zone benefits for data center projects, and Google did not respond to inquiries. Still, smaller developers may be more willing to take advantage. The tax break has also become a political flashpoint: Senator Josh Hawley recently introduced legislation to eliminate opportunity zone funding for data centers, arguing that Big Tech should not receive tax breaks to build on farmland. Whether the incentive survives political and public backlash remains unclear, but it is already shaping the next wave of data center s{