Is SWPPX considered "tax efficient" for UTMA?

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
Megamill
Posts: 65
Joined: Sun Feb 11, 2018 10:44 am

Is SWPPX considered "tax efficient" for UTMA?

Post by Megamill » Wed Mar 07, 2018 9:16 am

Would Schwab S&P 500 Index fund be considered tax efficient per BH standards? This would be in a UTMA brokerage account that kids would take over when they're on their own.

dbr
Posts: 31156
Joined: Sun Mar 04, 2007 9:50 am

Re: Is SWPPX considered "tax efficient" for UTMA?

Post by dbr » Wed Mar 07, 2018 9:18 am

Yes, yes

User avatar
ruralavalon
Posts: 17065
Joined: Sat Feb 02, 2008 10:29 am
Location: Illinois

Re: Is SWPPX considered "tax efficient" for UTMA?

Post by ruralavalon » Wed Mar 07, 2018 9:40 am

Yes, the fund is tax-efficient.

Turnover is just 2%, and there have been no capital gains distributions in the last two years.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

User avatar
Svensk Anga
Posts: 625
Joined: Sun Dec 23, 2012 5:16 pm

Re: Is SWPPX considered "tax efficient" for UTMA?

Post by Svensk Anga » Wed Mar 07, 2018 9:44 am

Bear in mind that you want to generate taxable income in the UTMA when the kids are paying 0%. You will need to learn the rules for taxation of minors. You will likely want to do some tax gain harvesting when they are under the limit. This will increase their cost basis and result in less tax later if they elect to sell when they are subject to capital gains tax.

Post Reply