Explore Lianne & Luka's story.*

We started by discussing their long-term goals and appetite for risk, focusing on how much of their concentrated position they wanted to keep, how much to sell, and how to structure transfers or gifting as part of a broader plan to achieve those goals. Then we brought in Portfolio Transition Services to analyze the potential tax impact of different strategies for reaching these goals.

• Together, we established an annual tax budget to unwind their positions gradually—while being mindful of tax brackets and other implications—to help smooth their tax exposure over time.
• To keep their portfolio aligned with the broader market during this transition, Lianne and Luka adopted a direct indexing strategy. This allowed them to potentially generate capital losses through tax-loss harvesting—helping offset gains from the sale of their concentrated stock—while staying invested in a personalized, diversified way.
• They worked with an Options Specialist to implement a covered call strategy using multiple strike prices and expiration dates, aligned with their broader diversification and income goals. This allowed them to generate additional income while accepting defined trade-offs around potential upsides and the possibility of shares being called away prior to expiration.
• As shares were sold or called away over time, a Fixed Income Specialist helped them reinvest the proceeds into a municipal bond ladder—creating a reliable stream of income with potential tax advantages.

We met to understand their full financial picture and walked through potential strategies to help manage their taxable income in the years ahead.

• We explored whether Roth conversions made sense during years when their taxable income was temporarily lower—before they began taking required minimum distributions or Social Security. This could help reduce future tax liability while increasing flexibility in retirement.

We reviewed their portfolio for opportunities to reposition portions of their existing diversified holdings to be more tax efficient. This included strategies such as adjusting asset location Tooltip Asset location is a strategy that prioritizes more tax-inefficient assets for tax-advantaged accounts and more tax-efficient assets for taxable accounts. and applying tax-loss harvesting, along with sharing insights they could bring to their tax advisor to help optimize their annual tax plan.

We began by reviewing their existing trust documents with the Tax, Trust, and Estate team and encouraged Lianne and Luka to bring their daughter into the discussion. This helped ensure she understood the family's overall planning strategy and could carry it forward in the future.

To create dependable income for their daughter and manage the tax impact of diversifying concentrated stock, we suggested a Charitable Remainer Trust (CRT). The CRT provided her with an income stream, minimized taxes on the sale of appreciated assets, and designated that any remaining assets at the end of the trust would go to the donor-advised fund the family was establishing.

Finally, we helped them revisit personal spending priorities and modeled different scenarios so they could confidently enjoy more of their wealth during their lifetime while still planning for a lasting legacy.

After reviewing multiple approaches, they chose to establish a donor-advised fund (DAF) using appreciated stock from their concentrated position. This allowed them to:

• Support their favorite causes over time on a flexible schedule.
• Receive an immediate federal income tax deduction for the full value of their donation.
• Diversify donated shares without a capital gains impact.

By incorporating a DAF into their broader financial strategy, Lianne and Luka were able to support the causes they care about—while maximizing the impact of their giving from both a tax and legacy perspective.