In order to offset capital gains and/or up to $3000 of ordinary income, Atlas Capital will overlay a tax loss harvesting strategy on each account depending on client circumstance. This is the unique benefit of utilizing separately managed accounts over commingled investment structures (ETFs or mutual funds). Separately managed accounts allow us to sell an individual security once it falls below a certain threshold and replace it with a similar security with a new cost basis. While the loss is realized for tax purposes, the performance of the portfolio is not dramatically affected.

This strategy is most effective in the first few years of a portfolio’s existence. As the portfolio ages, the potential for tax loss harvesting is decreased as the cost basis for the existing positions becomes lower and lower as compared to market prices.