Boosting After-Tax Returns: An “All of the Above” Effort

AllianceBernstein

Paul Robertson, Gavin Romm

Article

1 Pages

AllianceBernstein examines how investors can improve after tax returns through a holistic framework rather than focusing only on pretax performance. The piece argues that tax management, portfolio construction, and investment vehicle selection all matter, while high turnover can quietly erode gains despite stronger headline returns.

Key Takeaways

Holistic Tax Framework: After tax results depend on multiple levers, including return generation, tax management, and portfolio structure rather than any single decision.
Short Term Tax Drag: AB notes that strategies with rapid turnover can create short term gains, which may be taxed at rates as high as 40.8%.
Municipal Bond Benefit: Municipal bond interest is generally exempt from federal taxes, while long term capital gains may face rates around 23.8%, creating potential tax efficiency advantages.
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