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In a recent episode of The Mack Podcast, Jenny Kowal, Senior Managing Director, Senior Income Tax Strategist at IEQ Capital, joined host Brian Adams for a wide-ranging discussion on tax-aware investing and its growing importance in family office strategy.
The conversation explored a theme that continues to gain traction among ultra-high-net-worth families: after-tax outcomes matter more than pre-tax returns.
From Academia to Ultra-High-Net-Worth Advisory
Kowal began her career in academia, where she spent two decades teaching tax law. That experience shaped her ability to distill complex tax frameworks into practical decision-making tools, a skill that now directly benefits the families she advises.
Her transition into private client advisory was driven by a desire to move from theory to practice, working directly with families navigating real-world liquidity events, executive compensation structures, and concentrated stock exposure.
Alpha vs. After-Tax Reality
When asked about the importance of tax-aware investing, Kowal addressed a common imbalance in how families allocate attention and resources. Many investors devote significant effort toward pursuing incremental alpha. Yet a single capital gain realization can trigger a 23.8 percent federal tax, or materially more in high-tax states.
“A lot of investment officers would be absolutely thrilled to be able to say, ‘We saved you 23.8% right off the top in one year.’ When you start with a much larger pie and allow that to compound over time, that is really impactful.” – Jenny Kowal
For long-term investors focused on sustaining a corpus across generations, this distinction is meaningful. Preserving capital at the point of realization can materially influence compounded outcomes over multi-decade horizons.
Planning Before Liquidity, Not After
A recurring theme in the episode was timing. One of the most common mistakes Kowal sees is engaging tax advisors after a transaction has already occurred. Once a liquidity event closes, planning flexibility narrows significantly.
Pre-liquidity planning often begins three to five years in advance. This allows families to evaluate asset location, coordinate potential loss harvesting, consider deferral strategies, and align investment decisions with estate objectives before gains are realized.
Tax-aware investing is not about letting “the tax tail wag the dog.” Economic decisions remain primary, but aligning timing, structure, and portfolio design with tax considerations can meaningfully improve long-term outcomes.
Public Equities as a Tax Asset
Another important shift discussed was viewing public equities not simply as allocations, but as potential tax assets. Direct indexing, loss harvesting strategies, and coordinated gain management across entities can create flexibility that did not previously exist in traditional buy-and-hold frameworks.
For families managing multiple accounts, trusts, partnerships, and private investments, coordinated oversight becomes increasingly important. Without it, gains and losses may be realized inefficiently across silos.
The Core Question for Family Offices
When asked what listeners should take back to their family offices, Kowal emphasized three themes: asset location, intelligent netting of gains and losses, and deferral wherever appropriate.
“Families need to think carefully about asset location. Are the right assets in the right places so you can intelligently net losses against gains? Do you have the right kinds of losses paired with the right kinds of gains? And are tax-inefficient assets, such as those generating ordinary income from interest, located in the most appropriate structures?” – Jenny Kowal
These are not isolated tactics. They require coordination across investment teams, tax advisors, and estate planning counsel. As family offices grow in sophistication, the demand for integrated income tax expertise continues to increase.
Final Thoughts
Tax-aware investing is not about predicting markets. It is about preserving optionality. For families managing complex portfolios, multiple entities, and generational goals, after-tax discipline can be one of the most consistent drivers of long-term wealth sustainability.
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This document is for informational purposes only and is intended exclusively for the use of the persons to whom it is delivered and the information provided therein is confidential and may not be reproduced in its entirety or in part, or redistributed to any party in any form, without the prior written consent of IEQ Capital, LLC (“IEQ” or “IEQ Capital”). Information contained in this document is current only as of the date specified in the document, regardless of the time of delivery or of any investment, and IEQ does not undertake any duty to update the information set forth herein. The information contained in this document does not constitute an offer to sell or the solicitation of an offer to purchase or sell any securities, including any securities or alternative investments recommended by IEQ. Regarding alternative investments, any such offer or solicitation may be made only by means of the delivery of a confidential private offering memorandum which will contain material information not included herein regarding, among other things, information with respect to risks and potential conflicts of interest. No representation is made that any client will or is likely to achieve its objectives, that IEQ Capital’s strategies, investment process or risk management will be successful, or that any client will or is likely to achieve results comparable to any shown or will make any profit or will not suffer losses or loss of principal. Investing involves risks. You should not construe the contents of this document as legal, tax, investment or other advice. Any tax-related decisions should be made after conducting such investigations as the investor deems necessary and consulting the investor’s own legal, accounting and tax advisers to make an independent determination of the suitability and consequences of a composite election.