Invest Your IRA Contributions

April 17, 2014

Did you make an IRA contribution this year? If so, remember to invest that cash you deposited. Many investors make IRA contributions as a way to lower their tax bills, but they will miss out on potential gains if they don’t take the next step and invest the money. A Vanguard study found that more than two-thirds […]

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Sell Now to Avoid Higher Tax Rates?

December 11, 2012

Some subscribers have wondered if they should sell fund shares to realize gains before the end of the year because taxes may be higher in 2013. We believe there is little or no advantage to making portfolio changes based on predictions about where taxes will be next year. Instead, it’s more important to follow the […]

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Tax Tactics for Mutual Fund Distributions

November 15, 2012

Earlier this week, we explained that it is rarely worth selling a fund to avoid a long-term distribution — that’s why we’d continue holding Class 2 Parnassus (PARNX), despite that PARNX is expected to make a large (6.5%) distribution of long-term capital gains on November 16. Today, we show why some investors might consider selling […]

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Parnassus Announces Big Distributions – What to Do?

November 13, 2012

Parnassus (PARNX) is expecting to make a sizeable capital gain distribution next week that could affect investors who recently bought into the Class 2 fund. PARNX is expected to distribute $2.71 long-term capital gains (6.5% of the fund’s NAV as of November 7, 2012) on November 16. If you own PARNX funds in a taxable […]

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Some ETFs Bring Unexpected Tax Consequences

June 28, 2011

ETFs are often considered tax efficient because they generally don’t distribute capital gains, but as we wrote in the April issue of NoLoad FundX, certain ETFs can bring unexpected tax consequences: Most ETFs are structured as open-end funds, but some ETFs are structured as partnerships or as grantor trusts and these ETFs can have different […]

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Tax Efficiency of Active Strategies

April 15, 2011

Subscriber Question: If I follow an active trading strategy like Upgrading, won’t I incur higher taxes? NoLoad FundX Answer: Although Upgrading is an active investment strategy, with turnover averaging over 100% annually, it has proved to be surprisingly tax efficient. One of the great investment myths is that higher turnover automatically means higher taxes. Portfolio […]

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