Identify tax-loss harvesting opportunities across client accounts seasonally
This solution transforms how financial advisors manage tax liabilities by automatically scanning client portfolios to capture fleeting tax-loss harvesting opportunities. For MSPs, pitching this means offering RIAs a clear way to generate measurable client value and justify their advisory fees while creating a sticky managed service.
The problem today
$2M
in potential tax savings left on the table per year
100 bps
of after-tax returns lost to inefficient portfolio monitoring
Marcus Webb is the founder and lead advisor at a 3-person RIA in Alpharetta, Georgia, managing $180M for about 380 mostly pre-retirement households. He loses sleep every October knowing his team has no systematic way to find tax-loss harvesting windows before they close — and he's already lost two clients this year to larger firms that handed them a documented after-tax alpha report at their annual review.
01The Problem
No manual process covers a full book, so harvesting windows close before anyone notices they opened.
Late movers compete with every other advisor for the same positions — the best opportunities are already gone.
A missed 30-day repurchase window voids the harvested loss, triggers IRS penalties, and produces a formal client complaint.
Manual spreadsheet reconciliation produces a tax picture that should be visible in under a minute.
Clients paying full advisory fees have no documented evidence that tax-aware advice is happening on their behalf.
AUM that compounds at a larger firm after an after-tax alpha report closes a revenue hole that never reopens.
02The Solution
Solution Brief
Fictional portrayal · illustrative
- Marcus Webb: 3-advisor RIA, $180M, 380 pre-retirement households
- Harvesting windows open and close unseen across the full book
- No infrastructure to catch positions before the window closes
- Two clients lost this year to documented after-tax alpha reports
- Each departed $500K+ account: a compounding revenue hole at 1% AUM
- Wash-sale exposure unmonitored for 30-day stretches at a time
- Clients paying full fees receive no tax-aware documentation
- Agent scans every account continuously against each client's marginal tax rate
- Flags wash-sale risk before a trade executes
- Generates quarterly after-tax basis-point summary per household
- Turns annual review into a documented retention event for $500K+ clients
- Custodial data integrations + ongoing monitoring bill at $3,000–$7,000/month with high switching costs
“I used to dread Q4 because I knew we were scrambling and probably leaving money on the table for people who trusted us. Now I walk into every client review with an actual number — here's what we harvested, here's what it saved you. That conversation used to make me nervous. Now it's the reason people stay.”
— Marcus Webb is the founder and lead advisor at a 3-person RIA in Alpharetta, Georgia, managing $180M for about 380 mostly pre-retirement households
03What the AI Actually Does
Continuous Harvesting Scanner
Monitors every client account in real time — not just at year-end — for unrealized loss positions that cross meaningful thresholds. Surfaces harvesting windows as they open, ranked by estimated tax impact per household.
Wash-Sale Guard
Tracks the 30-day repurchase window for every harvested position and flags any pending trades that would trigger an IRS wash-sale violation before they execute, protecting both the client's deduction and the firm's compliance record.
Tax Rate Intelligence Layer
Pulls each client's marginal tax rate and capital gains exposure from their most recent tax return to ensure harvesting decisions are calibrated to actual client benefit — not just portfolio mechanics.
Household-Level Opportunity Report
Generates a plain-English summary of harvesting activity per client household each quarter — the kind of document an advisor can hand to a client at a review to show exactly what the fee is doing for them.
04Technology Stack
Orion Portfolio Solutions (Portfolio Management + Trading + Custom Indexing)
Platform fee: 10–40 bps on AUM under Custom Indexing; base portfolio management starts at ~$1,200–$2,500/mo for firms under $300M AUM. Quote-based.
Core TLH engine. Orion Custom Indexing provides year-round automated tax-loss harvesting with direct indexing capability. Includes daily portfolio sca…
Redtail CRM
$39/user/month (Launch, billed annually) or $59/user/month (Growth, billed annually). Estimated $195–$295/month for 5-advisor firm.
#1 market share CRM for financial advisors. Provides household-level data structures essential for multi-account TLH coordination, activity logging fo…
Holistiplan
Starting at $160/month; scales with household count. Typical firm: $160–$350/month.
AI-powered tax return analysis tool. OCR engine ingests client 1040s in 45 seconds, automatically identifying marginal tax rates, capital gain exposur…
BlackRock Tax Evaluator
Free - no licensing cost
Complementary screening tool used by 7,000+ advisors. Monitors capital gains estimates across 7,000+ mutual funds and ETFs. Advisors use this to ident…
CrowdStrike Falcon Go
$5–$8/endpoint/month MSP cost / $12–$18/endpoint/month managed service resale. ~$60–$90/month for 10 endpoints.
Next-generation endpoint detection and response (EDR) for all advisor workstations. Required for SEC Regulation S-P compliance—written incident-respon…
Smarsh Enterprise Archive
$15–$30/user/month depending on channels archived. ~$75–$150/month for 5 users.
SEC/FINRA-mandated email and electronic communications archival. Captures, indexes, and retains all advisor email, text messages, and social media com…
Duo Security MFA
Duo Essentials: $3/user/month. Duo Advantage: $6/user/month. ~$30/month for 5-user firm on Advantage tier.
Multi-factor authentication for all platforms. All wealthtech vendors (Orion, Schwab, Fidelity) mandate MFA. Duo provides a unified MFA layer across c…
Datto SIRIS (Backup & DR)
$300–$600/month depending on data volume and appliance tier. Includes cloud retention.
Hybrid cloud backup and disaster recovery with AES-256 encryption and 7-year retention capability per SEC recordkeeping rules. Protects local data, Mi…
Proofpoint Essentials
$3–$5/user/month MSP cost / $8–$12/user/month managed resale. ~$40–$60/month for 5 users.
Advanced email threat protection. Phishing is the #1 attack vector targeting financial advisory firms. Proofpoint filters malicious emails before they…
05Alternative Approaches
Altruist TaxIQ
Free on fee-bearing marketplace models; 10 bps/year on no-fee models and custom portfolios
For smaller RIA firms under $150M AUM that are already on or willing to move to the Altruist custodial platform, Altruist TaxIQ provides native tax-loss harvesting at the custodial level with no additional platform fees. TaxIQ includes automated drift monitoring, tax loss harvesting, and rebalancing built directly into the custodian's portfolio management tools. The TLH feature is free on all fee-bearing marketplace models and only 10 bps per year on no-fee models and custom portfolios. Direct indexing minimums start at just $2,000 per account.
Strengths
- Significantly lower cost than Orion—potentially saving $1,000–$3,000/month in platform fees
- Simpler deployment since everything is native to one custodial platform with no API integrations between portfolio management and custodian
Tradeoffs
- Less sophisticated than Orion Custom Indexing—fewer customization options and less granular reporting
- Newer platform with less track record (Altruist AUM grew 119% in 2025 but is still much smaller than Orion)
- Requires the firm to custody assets at Altruist—firms with existing Schwab or Fidelity relationships would need to transition clients
Best for: Startup RIA firms already on Altruist, under $150M AUM, wanting the simplest possible deployment with lowest ongoing costs
Envestnet/Tamarac Enterprise Tax Overlay
Quote-based enterprise pricing; typically platform fees + overlay management fees totaling 2–3x the Orion solution
For mid-size to large RIA firms ($500M+ AUM) with complex multi-manager, multi-custodian environments, Envestnet's Tamarac Trading platform provides the most sophisticated tax overlay engine in the industry. Tamarac Trading offers multiple 'Saved Search' options to proactively find tax loss opportunities across model-level, account-level, and security-level scans. Backed by $7.0 trillion in platform assets and 25+ years of experience, Envestnet provides enterprise-grade capabilities including UMA tax management and multi-sleeve portfolio overlays.
Strengths
- Most powerful TLH engine available—handles tax-managing across multiple model managers, offsetting gains in one sleeve with losses in another, and coordinating TLH across multiple custodians simultaneously
- Enterprise-grade UMA and multi-sleeve portfolio overlay capabilities
Tradeoffs
- Higher cost than Orion or Altruist—enterprise pricing is quote-based and typically 2–3x the Orion solution for a comparable firm size
- Significantly more complex to implement—requires extensive configuration for multi-manager setups with implementation timelines of 16–30 weeks
- Overkill for firms under $300M AUM
Best for: Firms with $500M+ AUM using multiple sub-advisors or model managers, custodying across multiple platforms, requiring institutional-grade tax management
Parametric/Vanguard Direct Indexing TAMP (Outsourced Approach)
20–40 bps on AUM annually (Parametric ~25–40 bps, Vanguard ~20 bps)
Instead of building an in-house TLH capability with Orion, the firm can outsource tax-aware portfolio management to a dedicated direct indexing TAMP such as Parametric Custom Core (Morgan Stanley) or Vanguard Personalized Indexing. The TAMP handles all TLH scanning, trade execution, wash-sale monitoring, and compliance documentation as a managed service. The advisor delegates portfolio management of eligible accounts to the TAMP, which constructs individual stock portfolios tracking a benchmark while continuously harvesting tax losses.
Strengths
- Highest TLH effectiveness—Parametric pioneered direct indexing 30+ years ago and manages hundreds of billions in tax-managed assets with more sophisticated algorithms than any advisor-facing platform
- Dramatically simpler for the MSP—minimal technology integration required since the TAMP handles everything
Tradeoffs
- High cost at scale—20–40 bps on AUM annually; for a firm with $50M in eligible accounts this is $100K–$200K/year, significantly more expensive than the Orion self-managed approach
- High account minimums ($100K–$250K per account for Parametric, $250K for Vanguard) exclude mass-affluent clients
- Reduces advisor control over individual trades
- MSP loses the managed wealthtech services revenue stream since the TAMP handles the technology
Best for: Firms with a concentrated HNW client base with $250K+ taxable accounts wanting to minimize technology complexity and willing to pay higher fees for institutional-grade TLH as a managed service; best used for HNW segments alongside Orion for mass-affluent clients
Spreadsheet-Based Manual TLH (Minimal Technology Approach)
~$160–$300/month (Holistiplan only)
For very small RIA firms (under $50M AUM, fewer than 50 taxable accounts) that cannot justify platform costs, a structured manual approach using Excel/Google Sheets with quarterly discipline can deliver meaningful TLH value. The MSP deploys a custom spreadsheet template that pulls position data via custodial CSV exports, calculates unrealized gains/losses, identifies opportunities, and documents the TLH decision process. Combined with Holistiplan for tax intelligence and BlackRock Tax Evaluator (free) for fund screening, this approach costs under $300/month total.
Strengths
- Dramatically lower cost—approximately $160–$300/month (Holistiplan only) vs. $2,500–$6,000/month for the full Orion stack
- Low technology complexity
Tradeoffs
- High operational complexity—requires manual data entry, manual wash-sale checking, and disciplined quarterly execution
- Significantly less effective—manual processes miss opportunities between quarterly reviews and are prone to human error in wash-sale checking
- Cannot scale beyond ~100 accounts; no automated alerts or daily scanning
- Wash-sale violations more likely with manual tracking
- High advisor time cost
- Does not scale—a stepping stone, not a destination
Best for: Solo practitioner with under $50M AUM and fewer than 50 taxable accounts, very limited technology budget, wanting to start delivering TLH value while building toward a platform-based approach in 12–18 months as AUM grows
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