What's New Guide to LifeYield® Tax Optimizer


Taxes are the single biggest expense category for consumers with $500K+ of investable assets. Quicken has partnered with LifeYield® to integrate Tax Optimizer, now available with Quicken Premier, Home and Business, and Rental Property Manager. This new feature helps you manage your investments in a tax-smart way so that you can lower your investment taxes.  You must meet  certain criteria to use this feature.*

* Certain criteria must be met in order to use LifeYield Tax Optimizer: Must have at least one taxable investment income, a target allocation set within Quicken, asset classes assigned for at least 95% of your holdings, and no placeholder transactions in your taxable accounts.

  • Get started with LifeYield Tax Optimizer by clicking on Investing >Tax Optimizer. Click on the ‘Get Started’ button to get started with LifeYield Tax Optimizer
  • Quicken performs few validations to ensure that you get the maximum benefit from the tool. There are 4 main checks that are performed:
      • You should have at least one taxable investment account – So that we can help with tax savings on the same.
      • You should have set a target allocation in Quicken – This helps Tax optimizer to ensure that it suggests trades inline with your goal. 
      • Asset classes for at least 95% of your holdings – This helps Tax optimizer to find appopriate trade suggestions that match your target goal and to implement tax efficiency through asset allocation.
      • Fix placeholders – Quicken creates placeholders if your the transaction history doesn’t match the current holding. Tax optimizer will provide most accurate results when you resolve these placeholders

      The ‘Continue’ button will be enabled only if you meet all the criteria.

      If you see a ‘red cross’ mark against any criteria, it means that your datafile is not meeting the validation criteria. If you see a ‘red mark’ read the help (yellow help button) on that criteria to know what steps need to be taken to fix the same, close the window, go back and fix the issue, before you can ‘Get started’ with LifeYield Tax Optimizer again.

      Note: Placeholders is not a mandatory criteria and hence some times we do allow the user to continue if there aren’t a lot of placeholders.

  • Once you have fixed all the criteria, the ‘Continue’ button will be enabled. Click on ‘Continue
  • Click on ‘Accept’ to allow Quicken to share your portfolio data to LifeYield.
  • Once you hit ‘Accept’ Quicken will pass your information to LifeYield. You may be asked to enter the Intuit ID / password if required to authorize the data exchange. This takes you to the ‘Set up page’ which has three tabs. You can play around with the Set up page to do some ‘What if’ analysis. The ‘Accounts’ tab allows you to select the accounts that you would like to be included for tax optimization analysis.
  • The ‘Tax Rates’ tab lists the tax rates that LifeYield uses. If you wish to edit any of the rates, do the same and hit on ‘Continue’.
  • The ‘Target Allocation’ tab displays the ‘Current’ and ‘Target’ asset allocation that you have set. You may modify the target allocation if you wish to do so.
        The ‘Target Allocation’ tab displays the ‘Current’ and ‘Target’ asset allocation that you have set. You may modify the target allocation if you wish to do so.
      • What does it look like?
        What's New Guide to LifeYield® Tax Optimizer
  • Click on ‘Done’ which will take you to LifeYield page where you have to accept the ‘Terms and Services’. Please scroll down till the end of the Terms and Services page and then hit on ‘Accept
  • This will take you to the ‘Benefits’ page of LifeYield Tax Optimizer
  • You can click on ‘Dashboard’ menu on the LifeYield screen to view more detailed report of your trade suggestions. You can also download the report by clicking on ‘Generate Report’ button.
  • Scroll down the page and click on the What's New Guide to LifeYield® Tax Optimizericon to view the trade suggestions on each account.
  • The Set up menu takes you back to the Set up screen which allows you to choose accounts / set up tax rates or modify target allocation. You can always click on the ‘Tax Optimizer Dashboard’ button from the bottom of the set up screen to go back to the dashboar.
  • Click on the ‘Settings’ gear icon to open the Tax Optimizer Settings page which helps you set your options. Click on the ‘yellow help icon’ near each option to understand more about about these options.
    • You can choose to display cash trades – This option is to display the amount of cash, if any, that is generated by the sells suggested by LifeYield Tax Optimizer that is not used to make any suggested buys.
    • Enable Allocation Drift Monitoring – This option can be set to alert you if your portfolio drifts more than ‘x’ percentage from your target allocation.  ‘x’ is set by the threshold that you specify.
    • Enable Location Drift Monitoring – LifeYield Tax Optimizer compares the actual location of all of your assets across your various taxable and tax-advantaged accounts and compares it to the most tax-efficient location of the same assets. A Location Drift of 0% means that all your holdings are in the most tax-efficient location possible given the available account types and balances, whereas Location Drift of 100% means your portfolio is tax-inefficient and could benefit from relocation. You can enable this option and set a Location Drift threshold in order to help monitor Location Drift.
    • You can view your trade details either at a tax lot level or rolled up to a holding level.
  • If you have any doubts, refer to the video by clicking on ‘Watch a Video Tour’. You can also refer to the ‘Frequently Asked Questions’ under the Support menu.

 

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Tip: To find out which version of Quicken you are using, open Quicken go to Help menu and select About Quicken.