Paige Smith & Loukia Gyftopoulou (Bloomberg Law): Schwab Prepares Its Own Version of Tax Strategy Used by the Rich
Charles Schwab Corp. is preparing to build out its own tax-aware long-short products as the firm’s customers have piled into the strategy beloved by millionaires looking to cut their tax bills.
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“It’s a way we can deliver sustainable long-short strategies to our clients in a way that is operationally and financially manageable over the longer term,” Wurster said. His comments come after the firm, which provides custody for such strategies, recently tightened its limits for customers wishing to access them.
Tax-loss harvesting strategies have grown so rapidly that regulators are getting worried. The Internal Revenue Service issued an array of warnings to Wall Street last month saying it plans to publish guidance and may take other steps to bar certain trades that money managers are using to help clients harvest losses and lower tax bills, including on ordinary income.
Related TaxProf Blog coverage:
- Hemel: Ordinary Loss Harvesting — A Tax Shelter of Treasury’s Own Making (Oct. 4, 2026)
- Treasury Follows Through on “Too Good to Be True” ETF Tax Strategies (Oct. 3, 2026)
- More on Tax-Aware Long-Short Investing Strategies (Aug. 24, 2026)
- Bloomberg: A Tax Strategy for the Rich Built the World’s Largest Hedge Fund (Aug. 5, 2026)
- Treasury Raises Concerns About Tax-Aware Investment Products (July 25, 2026)
- WSJ: Stock Gains Without All the Taxes? (June 15, 2026)
- Wall Street’s Tax Alpha Craze (Apr. 22, 2026)
- Hemel: The Tax Trap Inside the BOXX (Mar. 26, 2024)
- T-Bills Without Tax Bills? “Poster Child for Tax Arbitrage” or “Democratization of Tax Dodges”? (Feb. 23, 2024)
