The Mack Podcast Tax-Aware Solutions for Concentrated Stock
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Mar 3, 2026 Jenny Kowal, Managing Director and Senior Income Tax Strategist at IEQ Capital with 25+ years advising ultra-high-net-worth families, joins to reframe tax as a strategic lever. Conversations cover why income tax now drives portfolio decisions. Topics include tax-aware investing vs chasing alpha, treating public equities as tax assets, concentrated stock solutions, and priorities like netting, location, and deferral.
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Tax Awareness Often Beats Chasing Small Alpha
- Tax-aware investing can outstrip pursuit of marginal alpha because tax rates on gains often dwarf achievable active outperformance.
- Jenny Kowal notes a 23.8% capital gains hit versus typical small alpha, so preserving pre-tax principal compounds far more over decades.
Taxes Are A Permanent Drag Compared To Market Pullbacks
- Market pullbacks are unavoidable but tax losses are permanent and avoidable, so tax planning can be more controllable than market timing.
- Kowal emphasizes capital gains paid at sale don't 'come back' like market dips often do, so minimizing tax at liquidity matters.
Start Pre-Liquidity Planning Three To Five Years Early
- Do pre-liquidity planning as early as three to five years before a major event to optimize asset location and grouping for netting losses and gains.
- Kowal warns coming to advisors late (e.g., November after a sale) leaves few options.