Tax-Loss Harvesting

Tax-loss harvesting is the selling of securities at a loss to offset a capital gains tax liability. Advisors may harvest losses on an account or portfolio level. Tax losses will only be generated if accounts are taxable and have open tax lots. If rebalancing a portfolio that contains a mix of taxable and tax-deferred/tax-free accounts, Oranj will skip accounts that are not taxable. The order in which lots are sold is determined by the account’s selected accounting method.

To maximize the effectiveness of performing a tax-loss harvest, the following fields can be completed by the advisor on an individual account:

• Capital Loss Carry-Forward ST/LT
• Year to Date (YTD) ST/LT Gain

To perform a tax-loss harvest (TLH) on an account or household portfolio, navigate to the specific account or household portfolio and click on the TLH button. This will initiate a rebalance that will target selling positions to generate a tax loss. Oranj will ignore the model targets and will seek to maximize selling lots that generate a loss, respecting all applied firm- and account-level trade settings such as Do Not Sell and Exclude.

Harvest to Maximize Losses

This type of tax-loss harvest seeks to maximize losses across the account, and will generate only sell orders to do so. It will ignore model targets but respect all applied firm- and account-level trade settings such as Do Not Sell and Exclude. It will not take into consideration security equivalents.