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Smart Tax Strategies

Smart Tax Strategies

Prudent asset allocation decisions are critical in developing a plan to meet long-term investment objectives.


Tax planning can be a complicated balance as related to one’s investment portfolio. Client’s product choices can exacerbate tax and AMT (alternative minimum tax) issues. Conversely, many investments sold as tax efficient and/or to provide tax deferral may accomplish these goals, but at the expense of liquidity and performance, and often with added layers of fees. Provo Financial Services, Inc. seeks to make all portfolios tax aware, and employ appropriate tax minimizing investment strategies, as appropriate.

Beyond the benefits of proper product choice with regards to taxes, there are two other major areas of intersection between investing and taxes:

  1. Taxes will be a significant cost in retirement. Pensions, Social Security, and IRA withdrawals are all within the realm of “taxable” money. Taxes and health care will be the two biggest sources of spending in most clients’ retirement.
  2. Taxes can be a drag on performance. There are investments that are best held within tax deferred vehicles, such as IRAs and annuities, and there are assets best held in taxable vehicles, such as brokerage accounts. Portfolio turnover can generate additional costs to non-qualified accounts, while proper tax-loss harvesting can minimize a client’s tax burden.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor. To learn more about tax planning within your investment portfolio, and how Provo Financial can help, request a consultation today.