high net worth tax strategies

High-net-worth tax strategies

For high-net-worth (HNW) clients, investing for after-tax outcomes is paramount.
Contact an SMA specialist Contact an SMA specialist

High-net-worth clients

High-net-worth investors are the largest client base in the wealth market. While these clients are a top priority for advisors, they often face a unique set of tax challenges. Advisors that embrace tax-management in their practice and provide differentiated solutions will be better positioned to win new business and retain relationships.
high net worth wealth concentration

Attract and serve today’s high-net-worth clients

Our new ‘Growing high-net-worth practice’ deck will help guide your client conversations with industry trends and commercial insights, as well as strategies to help your clients minimize taxes across their portfolios and keep more of what they earn.

Access the presentation Access the presentation

SMAs: a tax-efficient solution for high-net worth individuals

Separately Managed Accounts (SMAs) are professionally managed portfolios of directly-held individual securities. This means clients blend the benefits of direct ownership and institutional portfolio management.

One key benefit of individual security ownership is the flexibility to manage taxes at the client level.

3 key tax benefits of SMAs

Working together, our people and technology craft individual solutions to clients’ most complex investment challenges. BlackRock SMA solutions are built to address a broad range of investment objectives.
transition
In-kind transition of individual holdings to fund portfolios tax-efficiently and avoid capital gains realization at time of enrollment.
growth
Ongoing tax-loss harvesting to opportunistically generate losses to offset gains elsewhere in the portfolio.
tax efficient
Tax-efficient withdrawals to manage the tax implications of withdrawing funds from the account.

Explore other benefits of SMAs

Explore BlackRock’s suite of tax efficient SMA solutions

BlackRock's suite of SMAs gives advisors the tools to better tailor portfolios to the specific needs of their high-net-worth clients. BlackRock offers access to a range of solutions across fixed income, equity, and options overlay strategies, allowing for tax-management across the portfolio.

Contact an SMA specialist

Direct index Municipal Fixed Income Option overlays
Image Cta-3,Multi Column Teaser-2,Paragraph-3
Image Cta-4,Multi Column Teaser-3,Paragraph-4
Paragraph-5,Related Content-1,Paragraph-6

Direct index SMAs offer core equity exposure seeking to match the returns of an index pre-tax while outperforming after tax through ongoing tax loss harvesting.


For example, if you owned every stock in the index, you could sell losers to generate losses, even in a bull market year.
> Tax-loss harvesting Tax-loss harvesting
tax loss harvesting

Benefits of directly indexed tax-managed SMAs through Aperio**

Active tax management:
Aperio utilizes best-in-class tax-loss harvesting strategies in an effort to increase tax alpha, or after tax returns.
In-kind transitions:
A portfolio can be funded with existing stocks and select ETFs with unrealized gains, which can limit the tax cost of a new portfolio.
Access to industry experts:
Our tax economists, strategists, and values-aligned experts act as an extension and wealth of knowledge to guide you along your investment journey

Access Direct Index SMAs through Aperio

**Aperio was acquired by BlackRock February 2021. Aperio cannot hold BlackRock ETFs in IRA or ERISA accounts.

Municipal bond SMAs can be customized to the tax location of an investor. This means clients can choose individual bonds to potentially reduce taxes on interest income at the federal, state, and local level.
muni customization
Platform depth, size and scale
BlackRock’s deep credit research analysis, access to inventory and tighter spreads are critical for the opaque Muni market.
In kind transitions
Transition assets in accordance to your clients multi-year tax budget while minimizing turnover.
Access to portfolio managers (PMs)3
BlackRock portfolio managers work with you locally to solve complex challenges and help grow your practice.

Option overlays pursue specific investing goals without disturbing an existing portfolio. This can be particularly useful for high-net-worth investors who often struggle with rebalancing low-cost basis portfolios and diversifying from concentrated stock due to the tax implications.

Tax efficient option overlay solutions for HNW clients

Manage concentrated stock

Many HNW clients hold concentrated positions from their employer, an inheritance, or picking the right stock at the right time. Option overlays seek to reduce risk tax efficiently.

Manage portfolio risk

Option overlays may be used to reduce risk on existing ETFs, mutual funds, and SMAs. Done as overlays, they may provide flexibility for tax efficient portfolio transitioning and risk management.

Access to Option Strategists:
BlackRock Option Strategists provide option expertise and can help educate you on applicable strategies to scale option usage across your practice.

Contact a BlackRock option strategist

Access Option overlays