In this episode of "Your Investment Partners," hosts Paul and Garrett examine the concept of a 351 Exchange and how it applies to taxable accounts with highly concentrated positions. They delve into strategies for achieving diversification while deferring taxes, exploring how this specialized section of the tax code allows investors to reallocate portfolios without realizing immediate tax liabilities. The conversation highlights the process, benefits, and limitations of using 351 ETF exchanges to manage large, concentrated positions effectively. Tune in to learn how this approach might help you reduce portfolio risk and maintain tax efficiency.

Key Points From This Episode

• Introduction to the concept of 351 Exchanges.
• Comparison with 1031 Exchanges used in real estate.
• Focus on taxable accounts with concentrated positions.
• Explanation of diversification benefits and tax deferral.
• Specific rules for eligibility, including limits on individual positions.
• How 351 ETF exchanges enable portfolio rebalancing without immediate taxes.
• Advantages of ETFs over mutual funds for tax efficiency.
• Step-by-step process for executing a 351 Exchange.
• Benefits of liquidity and flexibility post-ETF exchange.
• Considerations for choosing partners and professionals for implementation.

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Useful Links

Garrett on LinkedIn

Paul on LinkedIn

Ascend Investment Partners