Reducing the current tax liabilities on your investments can help enhance your overall returns. Implementing our Tax Management Services in a taxable managed investment portfolio, known as a Unified Managed Account (UMA), seeks to offer you professional and tax efficient portfolio management to help meet your unique financial goals.
Tax Management Services
A wealth management tax services strategy designed to help keep more of your returns with a tax-managed investment portfolio.
Tax Management Services
Taxes can make a big difference over the long run in helping meet financial goals – so you need a tax-smart edge. Learn how Morgan Stanley Tax Management Services can help efficiently manage your capital gains with a complimentary and fully personalized experience.
Meeting financial goals takes a combination of planning and an inventive edge. There is no one winning strategy. The best strategy may be a combination that’s constructed just for you. And at Morgan Stanley, we can build that together.
But there’s one component that is often overlooked—even though it can make the biggest difference over the long run: taxes.
Taken together, tax-aware solutions, may potentially add up to 2% to your annual returns, on average, depending on your specific portfolios and approaches.
By adding our complimentary -- and personalized -- Tax Management investment platform to your taxable managed account, we can help maximize your potential after-tax return, year-round. That’s our Total Tax 365 approach.
Do you want to be more in control of your capital gains each year? Our platform enables you to set gain or tax limits that put you in control of the impact of taxes on your investments. Because after all, taxes are personal.
While tax-loss harvesting is common for many investors these days, it tends to be labor intensive. Morgan Stanley’s advanced platform lets you design your own tax-loss harvesting experience.
For instance, you can select the loss harvesting frequency, your loss targeting approach or customize our opportunistic tax-loss harvest feature that systematically identifies losses to capture throughout the year.
And when losses are created, we look to preserve those losses by adhering to certain IRS wash sale rules so that those realized losses can help potentially offset future gains.
In today’s market, every trade decision matters. But how you tax-optimize your trades may matter even more.
That’s why we also provide our best-tax-outcome approach when trading your securities. This feature looks through your various tax lots and attempts to achieve the most favorable tax outcome on every sale transaction.
Lastly, if you are considering transitioning assets to Morgan Stanley, but are concerned about large capital gains and subsequent taxes, don’t be.
Our sophisticated platform helps you unwind existing positions into a new diversified investment portfolio gradually, and on your terms.
And every step of the way, we report back results that show how much tax savings you may have captured over time. Because the returns you keep are the ones that count.
So, when working to meet your financial goals, you set the rules. Together, we’ll refine your strategy … and offer the tax-smart edge that puts you in control of your assets and your wealth.
Contact your Morgan Stanley Financial Advisor and ask how to enroll in this complimentary service.
Clients may elect Tax Management Services for the account by notifying their Financial Advisor, and indicate what Maximum Tax or Realized Capital Gain Instruction is desired for the account, if any. The Tax Management Services Terms and Conditions attached to the Morgan Stanley Smith Barney LLC Select UMA ADV brochure as Exhibit A will govern Tax Management Services in the account. Review the Morgan Stanley Smith Barney LLC Select UMA ADV brochure carefully with your tax advisor. Tax Management Services are not available for all accounts or clients and may adversely impact account performance. Tax Management Services do not constitute tax advice or a complete tax-sensitive investment management program. There is no guarantee that Tax Management Services will produce the desired tax results.
Diversification is no guarantee of profit and does not protect against loss.
There is no guarantee that tax-loss harvesting will achieve any particular tax result.
When Morgan Stanley Smith Barney LLC, its affiliates and Morgan Stanley Financial Advisors and Private Wealth Advisors (collectively, “Morgan Stanley”) provide “investment advice” regarding a retirement or welfare benefit plan account, an individual retirement account or a Coverdell education savings account (“Retirement Account”), Morgan Stanley is a “fiduciary” as those terms are defined under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and/or the Internal Revenue Code of 1986 (the “Code”), as applicable. When Morgan Stanley provides investment education, takes orders on an unsolicited basis or otherwise does not provide “investment advice”, Morgan Stanley will not be considered a “fiduciary” under ERISA and/or the Code. For more information regarding Morgan Stanley’s role with respect to a Retirement Account, please visit www.morganstanley.com/disclosures/dol. Tax laws are complex and subject to change. Morgan Stanley does not provide tax or legal advice. Individuals are encouraged to consult their tax and legal advisors (a) before establishing a Retirement Account, and (b) regarding any potential tax, ERISA and related consequences of any investments or other transactions made with respect to a Retirement Account.
Morgan Stanley, its affiliates and Morgan Stanley Financial Advisors and Private Wealth Advisors do not provide tax or legal advice. Clients should consult their tax advisor for matters involving taxation and tax planning and their attorney for matters involving trust and estate planning, charitable giving, philanthropic planning and other legal matters.
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Features to Help Improve After-Tax Returns
We have made it simple to integrate current tax-mitigating strategies to potentially help enhance the net performance of your portfolio -- because the returns you keep are the ones that count.
Active Tax Loss Harvesting
Unlike the traditional method of harvesting losses toward year-end, a Select UMA Tax Managed account is reviewed on a more frequent basis throughout the year. If your Select UMA Tax Managed account has a net realized gain at the time an active tax loss opportunity is identified, Tax Management will attempt to offset the gain by selling positions that are currently held at a loss. This allows the account to take advantage of market movements throughout the year.
Opportunistic Tax Loss Harvesting
Market volatility can work in your favor. Your Tax Managed account is monitored daily for opportunities to harvest tax losses and take advantage of dips and dislocations throughout the year. This active approach allows you to focus on your investments, without missing an opportunity to tax loss harvest.
Client-Directed Tax Mandates
You have the option to set a limit on the total amount of net gains you wish to realize each year, or the total amount of capital gains tax liability you are willing to incur within your Select UMA Account. When your realized gains reach the amount you set, we prevent any sales in your account that would further increase your gains.
Tax-Efficient Trading
The Tax Management portfolio manager of your Select UMA account uses an efficient “best tax outcome” methodology that attempts to minimize capital gains and/or maximize tax losses when selling down a position with multiple lots.
Certain Wash Sale Adherences
When a stock, ETF or mutual fund is sold for a loss, under the wash sale rules, that loss may not be currently usable if the same or substantially identical security is purchased within 30 days of the sale that generated the loss. We attempt to protect that loss by blocking repurchases of the security in your Select UMA Account for 30 days, and it’s only bought back 31 days after the sale.
Account-Level Rebalancing
We automatically rebalance your account if your holdings drift from your desired asset allocation.
Enhanced Personalization
Help mitigate tax liabilities with a personalized approach for your portfolio. Morgan Stanley’s proprietary tools allow you to tailor your tax harvesting targets and frequency to fit your individual needs. Our process empowers clients to set gain limits to control their gain realization across their individualized portfolio.
Tax-Solutions for You
Speak to your Financial Advisor about how seeking tax-efficiencies may help you achieve your goals faster.
Check the background of our firm and investment professionals on FINRA's BrokerCheck.
Disclosures
Clients may elect Tax Management Services for the account by notifying their Financial Advisor, and indicate what Maximum Tax or Realized Capital Gain Instruction is desired for the account, if any. The Tax Management Terms and Conditions attached to the Morgan Stanley Smith Barney LLC Select UMA ADV Brochure as Exhibit A will govern Tax Management Services in the account. Review the Morgan Stanley Smith Barney LLC Select UMA ADV Brochure carefully with your tax advisor. Tax Management Services are not available for all accounts or clients and may adversely impact account performance. Tax Management Services do not constitute tax advice or a complete tax-sensitive investment management program. There is no guarantee that Tax Management Services will produce the desired tax results.
- Mutual funds reviewed for tax-loss harvest opportunity only during the 4th quarter tax-loss process. MLP securities for which a Schedule K-1 Tax Report is generated are excluded from quarterly systematic tax-loss harvest processes.
- Eligible and available securities include securities that are both IRS Wash Rule eligible and above the minimum tax-loss thresholds as described in the Select UMA ADV Brochure. See Exhibit A: Tax Management Services Terms & Conditions.
- Morgan Stanley and the Select UMA Tax Management Service do not guarantee adherence to the IRS Wash Sale Rule.
Morgan Stanley Smith Barney LLC, its affiliates and its employees are not in the business of providing tax or legal advice. Investors should seek advice based on their own particular circumstances from an independent tax advisor. The performance of tax-managed accounts is likely to vary from that of nontax-managed accounts.
Investing in the markets entails the risk of market volatility. The value of all types of securities, including mutual funds and exchange-traded funds, may increase or decrease over varying time periods.
Morgan Stanley Smith Barney LLC offers investment program services through a variety of investment programs, which are opened pursuant to written client agreements. Each program offers investment managers, funds and features that are not available in other programs; conversely, some investment managers, funds or investment strategies may be available in more than one program.
Please see the Morgan Stanley Smith Barney LLC Select UMA ADV brochure for more information on the Select UMA program. Ask your Financial Advisor for a copy or click here: www.morganstanley.com/ADV.
Select UMA® is a registered service mark of Morgan Stanley Smith Barney LLC.
CRC#6388836 (02/2024)