Selling an investment, withdrawing from a retirement account, or donating appreciated shares can affect your tax return. Before you act, your investment advisor and tax professional may need to review the same information.
Decisions worth discussing together
- Realizing investment gains or losses.
- Choosing which accounts to draw from in retirement.
- Converting retirement funds to a Roth account.
- Giving appreciated investments to charity.
- Raising cash for a purchase or another large expense.
The tax result is one part of the decision. Your advisor also needs to consider investment risk, available cash, and the purpose of the account.
A Roth conversion, for example
Your advisor may compare how a conversion could affect your retirement plan. Your tax professional can review the tax consequences using your income and other tax information. Looking at both helps you assess the proposed amount and timing before giving instructions.
Questions to ask before a transaction
- What tax information does my advisor need before making a recommendation?
- Has my tax professional reviewed the proposed transaction?
- Will I need cash for taxes or an adjustment to estimated payments?
- Who will carry out the transaction, and when?
If you work with more than one Koala team, we can share relevant information with your authorization. Investment advice and tax services remain separate engagements.
This material is for general educational purposes only. It is not personal investment, tax, insurance, or legal advice, and it does not create an advisory, CPA, insurance, or attorney-client relationship. Investment advisory services are offered through Koala Financial, Inc.; tax/accounting, legal, and insurance services are offered through their respective Koala entities.