From tax-loss harvesting to tax-aware wealth management

Wealth management has long focused on helping clients pursue better investment outcomes. But how much of those returns do clients actually retain after taxes?

Taxes can materially affect net investment results. Technology is making strategies such as tax-loss harvesting easier to apply consistently across client portfolios.

In a recent report, Cerulli found that nearly 80% of advisors have access to automated tax-loss harvesting capabilities, yet less than 30% of their clients receive these services.¹ For wealth management firms, that creates an opportunity to rethink tax-loss harvesting not as an occasional exercise, but as part of a more scalable approach to tax-aware wealth management.

The challenge with traditional tax-loss harvesting.

Tax-loss harvesting involves realizing investment losses that can help offset realized gains. While the concept is straightforward, implementing it across hundreds or thousands of portfolios can require significant manual effort.

Tax-loss harvesting has traditionally required significant hands-on effort, from reviewing tax lots and identifying losses to selecting positions and reinvesting proceeds. With automation, firms can streamline that work and apply their tax-management approach more consistently across portfolios, while keeping investment teams in control of the parameters that guide each decision.

Tax management gets more powerful at the household level.

Tax-loss harvesting is only one part of a broader strategy. Although an advisor may understand a client's full financial picture, investment decisions are often still made at the account level, which can limit the ability to consider tax and investment implications across the entire household. A unified managed household (UMH) approach helps address that challenge by enabling decisions to be evaluated across multiple accounts together.

That broader view can support capabilities such as:

• Tax-loss harvesting to identify opportunities to realize investment losses.
• Asset location to consider which investments are held in different account registrations.
• Multi-account rebalancing to manage portfolios across a household instead of exclusively within individual account silos.
• Tax-efficient transitions that consider tax implications while moving portfolios toward their target allocations.
• Tax-smart withdrawals that consider how cash can be raised across multiple accounts in a tax-conscious way.

Viewed together, these capabilities expand the conversation from tax-loss harvesting alone to an ongoing approach to tax-aware portfolio management.

Making tax management more scalable.

Delivering sophisticated tax management efficiently can be challenging. In an SEI survey of approximately 518 advisors, those already using a unified managed household approach reported spending an average of 48 hours per month manually executing UMH processes across client accounts.²

Technology can reduce that manual burden by helping investment teams identify harvesting opportunities across accounts, apply predetermined criteria, and prioritize tax lots more efficiently. This creates a more consistent, scalable process while preserving portfolio-manager oversight and giving advisors more time to focus on clients. 

Tax management can also create a stronger client conversation.

A more holistic view of taxes may offer another benefit: giving advisors a tangible way to demonstrate value.

Among 302 high-net-worth investors surveyed by SEI, 88% said they keep some assets away from their primary advisor, and 71% said their advisor has never asked to manage a greater share of their assets. Of those open to consolidating assets, 46% said saving money on taxes would motivate them to do so.³ 

That suggests an opportunity for wealth managers to make tax management part of a broader client conversation.

From tax-loss harvesting to tax-aware wealth management.

Tax-loss harvesting has greater potential when it is part of a coordinated, household-level approach to investment and tax decisions. With the right technology, wealth managers can deliver that approach more consistently at scale while giving advisors a tangible way to demonstrate value and help clients make more of their wealth over time.

¹ Cerulli report, US Managed Accounts 2026: Comprehensive Wealth Engagement.

² These statistics and implications were drawn from an SEI survey of 518 financial advisors about household portfolio management between Jan. 27 and Jan. 29, 2026. Among respondents, the average advisor age was 55. The average client net worth was $2.9 million. Average firm AUM was $523 million for advisors working as part of a team, and $205 million for advisors in individual practices. The survey was conducted by FUSE Research Network, LLC. 

³ These statistics and implications were drawn from an SEI survey of 302 U.S. adults (158 male, 144 female) between ages 50 and 70 who are currently working with a financial advisor and have investable assets of at least $1 million. Respondents were geographically dispersed across the Northeast, Midwest, South, and West. The survey was conducted April 24, 2026, through April 30, 2026, by YouGov from its panel of individuals who have agreed to answer surveys. 

Neither SEI nor its affiliates provide tax advice. Please note that (i) any discussion of U.S. tax matters contained in this communication cannot be used by you for the purpose of avoiding tax penalties; (ii) this communication was written to support the promotion or marketing of the matters addressed herein; and (iii) you should seek advice based on your particular circumstances from an independent tax advisor.