Practus partner and co-founder Robert Elwood was quoted in The Wall Street Journal article, “The Tax Strategy for People Suffering from Stock-Market Success,” which examines how investors with highly appreciated stock positions may use so-called Section 351 ETF exchanges as a potential tax-deferral and diversification strategy.
A Potential Path for Concentrated Stock Positions
The article explores how a long bull market has left some investors with significant unrealized gains and limited options for diversifying without triggering capital-gains taxes. For certain investors, contributing appreciated shares to a newly launched ETF through a Section 351 exchange may offer a way to diversify while deferring taxes until the ETF shares are sold.
Practical Insight from Practus
Elwood, offered practical context on the legwork involved in finding and participating in these transactions, comparing the process to “dating back in the days before Match.com.” The article also notes that Practus has advised on dozens of Section 351 ETF exchanges.
Read the full article here.
About Robert Elwood: Elwood focuses his practice on investment management, exchange-traded funds and registered funds, advising asset managers and financial services companies on fund formation, regulatory compliance and related transactional matters.
