Quotes About Tax consequences

The management of taxable mutual-fund assets without considering the tax consequences of trading activity represents a highly visible, yet little considered scandal. A serious fiduciary with responsibility for taxable assets recognizes that only extraordinary circumstances justify deviation from a simple strategy of selling losers and holding winners.

From a superficial perspective, tax-exempt bonds appear to offer investors the opportunity to place fixed-income assets in taxable accounts (where their special tax characteristics lessen or eliminate tax consequences), freeing capacity in tax-deferred accounts for higher-tax-burdened assets. Regrettably, the problems of credit risk and callability lessen the appeal of tax-exempt bonds to investors.