Simply put: funds with low turnover (if they're long equities).
Like...you're in a normal, vanilla mutual fund of growth equities. Which do you want if you're tax sensitive? One who trades/turns over 100% of its investments each year, i.e. realizes all of its gains and losses...or one which buys 100 stocks and then just goes and plays golf?
And statistically, both funds have almost the identical same performance. Well, for tax purposes, that first fund, in realizing all the gains every year, makes you pay ordinary income tax rates every year. So if it's up 12% in a year, and you live in a Blue State, you'll pay about 5.5% of that gain in tax, i.e. 6.5% is all that you'll be up, net of taxes. In the second fund, if it's up 12% and the fund has realized no gains, then you're up 12%. Yes, you carry forward the low cost basis of that fund...but if the fund never realizes it, then who cares?
Ok, and here's a 3rd thought on tax efficiency: Only invest in funds that go down in value. That way you'll never pay taxable gains. Or not. And/or you always have a muni bond fund out there in case you're in a more conservative mode.
Lots of choices. Lots of taxes.
Related or Semi-related Video
Finance: What is a tax haven?1 Views
Finance allah shmoop What is a tax haven Well it's
this kindly loving wonderful place just past the gates of
st peter you know maybe that's attacks heaven If you
tilt your telescope at just the right angle you'll see
the cayman islands of the bahamas You might see somalia
although it always seems to be storming therein And lately
you'll see ireland Yeah another tax haven Well how on
earth are all these countries linked Well they all offer
special tax incentives for corporations doing profitable business there such
that those corporations more or less pay little tax if
any Why was this even a thing Well in america
at least before trump became president there was a severe
hit against corporations who had divisions outside of the united
states selling printers or search links or purple leather handbags
for nine hundred ninety nine dollars each such that those
corporations were taxed once by the country in which they
did business Think france that was ah high tax rate
And then if those companies wanted to bring their cash
back to america to be held in an american bank
well then those companies were taxed again turning a dollar
Of profit into something like an thirty or forty cents
since it made no sense for companies to lose so
much hard earned profits so quickly to tax dollars Well
a mini industry in tax havens grew up all around
those unfair government dealings Well some of the schemes behind
these processes included something called a dutch sandwich and no
not the one with the raw hearing No in this
one the product is deemed as having been shipped by
an irish company but then booked or accounted for through
a shell or quays I fake company or holding company
in the netherlands sometimes remaining profits or then shipped to
the caymans or bermuda otherwise known as the bermuda black
hole Which leads the way for us to make a
joke here But we won't I say we do ever
strength There are three basic types of tax havens in
a dutch sandwich Primary tax havens Yeah those are the
ones with the shell corpse Then he have semi tax
havens where a country will produce goods for sale primarily
outside of their boundaries and have flexible regulations to encourage
you No job growth for themselves and third kind is
a conduit tax haven where income from sales mainly sales
made elsewhere is collected and then distributed back inside the
country Well over time the legal structure of tax havens
has shifted But in the new post obama era which
actively lowered corporate tax rates and defended american companies rights
to bring american cash back home to america While the
need for tax havens feels like it is slowly fading 00:02:43.803 --> [endTime] away But there's still more popular than tax heaven
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