The Money Mustache Community
Learning, Sharing, and Teaching => Investor Alley => Topic started by: Michael Robb on May 01, 2017, 01:21:44 PM
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Recently, I received a sum of assets (mostly mutual funds and individual stocks with some bond funds). They are held in a transaction based investment account meaning that I am charged no fees for holding the individual stocks, but am charged each time I buy or sell (individual stock or fund).
With my own savings, I've invested exclusively (with the exception of my work 401k at Vanguard) through Betterment, because I like the low-cost index fund model and I understand their fees.
I want to move this gift to Betterment so I can see everything in one place and conform to a model of investing I admire (indexing), but it would require selling the assets I received at a 15% capital gains tax and 1-1.5% transaction fee. Therefore, it doesn't seem very worth it to me... So, maybe I should leave everything as is (distributing dividends to spend or invest through Betterment) until I need to make withdrawals to spend instead of withdrawing only to reinvest.
Can anyone who has been in a similar situation or better understands accounting/taxation/investing weigh in and advise?
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Correct me if I'm mistaken, but after 1 year wouldn't selling them trigger long-term capital gains that are then taxed as a much more beneficial rate to you?
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Thanks for reading and replying! I hope more people comment.
Correct me if I'm mistaken, but after 1 year wouldn't selling them trigger long-term capital gains that are then taxed as a much more beneficial rate to you?
Long term capital gains tax is 15%. Short term is as income.