Investment in Freedoms | Tax Planning

INVESTMENT IN FREEDOMS: I love a good David and Goliath story, especially in the setting of Wall Street. Perth Tolle is one story that we’ve been following for a while now. Born in mainland China, she gained a unique perspective on the value and impact of freedom in her early life.

Fast-forward to today, and she has launched an emerging markets index that has garnered a long list of accolades from industry sources’ biggest names, including a 5-star rating from Morningstar. Good news! If you’re already invested with us, we are long-time shareholders of this ETF.

Her strategy is a compelling story: Are political and economic freedom better criteria for investing than traditional metrics alone, such as current GDP growth?

She provided a great discussion on a few key topics, like:

The difference that political freedom makes in an economy
The challenges of ethics-based investing tags, like ESG or SRI
The personal resilience required to launch her index in a hyper-competitive space

By Josh Manifold

Watch the full interview here:

*Morningstar Rating as of 03/17/2026 for MORN, Financial Services. The rating is based on Morningstar’s risk-adjusted return metrics over periods (if applicable). No compensation was provided by our firm to obtain or use this rating. Ratings are subject to change and are not indications of future performance This security is shown as an illustrative example selected using non‑performance-based criteria. It is not a recommendation to buy, sell, or hold any security and should not be relied upon as investment advice. Current and past holdings are subject to change and may not be representative of all investments.

LONG-TERM INVESTING: Generally, volatility isn’t the biggest risk in investing. Short time horizons tend to be the biggest detriment. Below are the worst S&P 500 annualized returns since 1928:

1 year: -44%

5 years: -13%

10 years: -2%

20 years: +2%

30 years: +8%

History seems to indicate that the longer you stay invested, the smaller the risk of a poor outcome.

GIFTING APPRECIATED STOCK: Most investors write checks to their favorite charities. However, if you hold appreciated investments, cash is often the worst asset to give. Here’s why: When you donate appreciated stock (or mutual funds, ETFs, or real estate) held longer than a year, you avoid the capital gains tax you’d otherwise owe when selling. And you still get a charitable deduction for the full fair market value. The charity gets the same dollar amount—only the IRS loses out here. In many cases, donating appreciated assets can be more tax‑efficient than cash, depending on your individual circumstances.

A “GIFT” FROM YOUR EMPLOYER: Employee Stock Purchase Plans (ESPPs) are one of the most powerful wealth-building tools available to you—and yet, Deloitte found that nearly two-thirds of companies see less than 50% employee participation (Source: Deloitte, The ROI of ESPPs, February, 2025, based on linked article). Here’s what you’re likely missing:

The basics work in your favor from day one. An ESPP lets your company reward you through equity—not just cash. Most plans allow you to purchase up to $25,000 of company stock per year at a 15% discount. That upfront purchase discount (typically up to 15%) can create value before market movement; actual outcomes depend on plan rules, taxes, holding periods, and sale timing.

The lookback provision makes it even better. Many plans let you buy at whichever price is lower—the price at the start of the offering period or the price at the end. This asymmetry is genuinely rare in investing. It’s one of the few situations where the structure of the opportunity itself works in your favor.

You aren’t forced to hold the stock. We can guide you through a review of your diversification and tax optimization. Participating in an ESPP and selling right away still captures real, meaningful value. This isn’t about stock-picking or market timing. It’s about maximizing your employee benefits and recognizing a structural advantage your employer is offering. If you’re not enrolled yet, invite us into a conversation about your employee benefits and ESPP.

OIL PRICES & THE STOCK MARKET:

TAX PLANNING: With a little under a month left in tax season, here are a few tax planning moves W-2 earners can make to possibly lower tax bills:

Max out your 401(k), 403b, 457, etc.
Max out your Roth IRA (you have until the tax filing deadline on this one)
Max out your HSA
Max out your 529 plan up to the amount of the state tax benefit
Use all your dependent care FSA funds
Use FSA funds, as most are ‘use it’ or ‘lose it’
Do tax loss harvesting on your taxable investment accounts
Do some tax gain harvesting within your taxable investment accounts
Consider electing into your ESPP for next year
Sell ESPP funds that became yours in December (if you want to lock in the discount)
Do Roth conversions to maximize lower tax brackets
Exercise ISO’s up to the AMT threshold (or maybe even past if it’s part of your plan)
Exercise NSOs if it makes sense
Look through your paycheck and make sure you have withheld enough for taxes
Do a mega-backdoor Roth if your company allows it and you have extra money
Donate cash to charity (maybe even consider bunching or a donor-advised fund to get even more in deductions)
Donate highly appreciated securities (before selling to avoid the capital gains tax)
Do a cost segregation study on your property, and bonus depreciate it while the bonus is still at 80%
Invest in a qualified opportunity zone if you have a large capital gain to defer
Prepay property taxes to hit max deduction

Talk with a tax professional about your options. If you don’t have one, we’d be happy to pass along a trusted name.

CORRECTED 1099s: Schwab issued corrected 1099s. It is not uncommon for investment providers to reclassify their distributions, resulting in the need for new 1099s to be issued. This historically has happened during the first few weeks of March, so be careful about not filing your tax return too early or you may have to amend it. Please take a moment to log into your Schwab Alliance and check if you have one to send to your tax professional. Or call our office, and we’d be happy to help.

THIS WEEK ON THE INTERNET: The best it has to offer this week: watch here.

*The views expressed represent the opinions of Compass Ion Advisors, LLC, as of the date noted and are subject to change. These views are not intended as a forecast, a guarantee of future results, an investment recommendation, or an offer to buy or sell any securities. The information provided is of a general nature and should not be construed as investment advice or to provide any investment, tax, financial, or legal advice or service to any person. The information contained has been compiled from sources deemed reliable, yet accuracy is not guaranteed.

Additional information, including management fees and expenses, is provided on our Form ADV Part 2 available upon request or at the SEC’s Investment Adviser Public Disclosure website here. Past performance is not a guarantee of future results.