Every February, I open one envelope with unusual curiosity: my 1099 from our custodian. It shows how much “income” my investments produced last year.
As an investor, I appreciate what that number represents. As a taxpayer, I also know what comes next: plugging it into a projection and watching how it changes what we’ll owe in April.
For me, it’s manageable. I’m still early in my career, and my portfolio is mostly stocks. But for many of the families we serve at Hill, this number can grow large enough that it doesn’t only affect their tax return — it starts to affect their entire financial plan.
And historically, there hasn’t been much we could do about it… until now.
Meet LVIG: A Different Way to Hold Fixed Income
Longview Advantage Fixed Income ETF (LVIG) is an ETF from our research partner, Longview Research Partners. Its aim is to solve a part of planning we historically could not control: Traditional bond investments generate taxable income whether you need it or not.
LVIG is built to avoid those automatic income distributions. Meaning more of the return stays inside the portfolio, which gives us control over how income shows up in your plan.
Like EBI, LVIG will be used inside Hill’s models. It may not be noticeable for younger, equity-heavy investors today. But as portfolios shift over time toward a higher allocation of fixed income, LVIG becomes a meaningful planning tool as well as an outstanding investment.
Where This Shows Up in Your Plan:
- Roth IRA conversions: Less portfolio income means more flexibility to convert traditional Individual Retirement Accounts (IRAs) to Roth IRAs during lower-income years.
- Asset location: We can comfortably hold fixed income in taxable accounts and reserve IRA and Roth space for equities, where long-term growth benefits most.
- Medicare and income cliffs like IRMAA (Income-Related Monthly Adjustment Amount), NIIT (Net Investment Income Tax), AMT (Alternative Minimum Tax): Keeping income lower makes it easier to stay below thresholds that trigger higher premiums and additional taxes.
- Trust planning: Trusts hit top tax brackets more quickly than individual tax brackets. Therefore, minimizing ordinary income allows trustees to distribute based on need, not tax pressure.
- Estate planning and step-up in basis: More return remains to compound as unrealized growth that may receive a step-up for heirs instead of getting taxed each year.
- Capital gains control: Lower income gives us more favorable opportunities to harvest gains at lower tax rates.
- Retirement cash flow: We can create distributions intentionally by selling shares at long-term capital gains tax rates rather than generating unpredictable taxable income.
Most of these benefits become especially impactful for clients who are retired or approaching retirement, have large taxable portfolios, are doing Roth conversions, have trusts, or are mindful of Medicare premium thresholds.
For younger clients, this may feel less important today. But over time, as allocations shift toward bonds, it becomes one of the more impactful planning levers available.
This is a good example of the subtle but powerful improvements we like making for clients at Hill Investment Group. Changes that not only improve your investment outcomes, but also make your plan work better behind the scenes.
While LVIG is something we are bringing to Hill portfolios, it will be a publicly traded ETF and available to all investors. Therefore, if you know someone navigating retirement, taxes, or trust planning who could benefit from greater flexibility, feel free to share this with them or have them reach out to us directly to see how we can be most helpful. Here’s the best link to get in touch with us.
You should consider the investment objectives, risks, and charges and expenses carefully before you invest in the Longview Advantage Fund (the “Fund”). The Fund’s prospectus or summary prospectus, which can be obtained by visiting www.longviewresearchpartners.com, contains this and other information about the fund, and should be read carefully before investing.
Investing involves risk, including possible loss of principal.
Active Management Risk. The Fund is subject to management risk as an actively-managed investment portfolio. The Adviser’s investment approach may fail to produce the intended result.
Derivatives Risk. Derivatives may be more sensitive to changes in market conditions and may amplify risks.
ETF Risk. The Fund invests in ETFs (Exchange-Traded Funds) and is therefore subject to the same risks as the underlying securities in which the ETF invests as well as entails higher expenses than if invested into the underlying ETF directly.
New Fund Risk. The Fund is recently organized, which gives prospective investors a limited track record on which to base their investment decision.
Fixed Income Securities Risk. Fixed-income securities are subject to the risk of the issuer’s inability to meet principal and interest payments on its obligations (i.e., credit risk) and are subject to price volatility resulting from, among other things, interest rate sensitivity, market perception of the creditworthiness of the issuer, willingness of broker-dealers and other market participants to make markets in the applicable securities, and general market liquidity.
Interest Rate Risk. Interest rate risk is the risk of losses attributable to changes in interest rates. In general, if prevailing interest rates rise, the values of debt instruments tend to fall, and if interest rates fall, the values of debt instruments tend to rise.
Distributions. There is no guarantee that the fund will pay distributions in the future, if any, may vary the current distribution.
Distributed by Quasar Distributors, LLC. Quasar is not related to Hill Investment Group Partners, LLC d/b/a Longview Research Partners, the fund’s Investment Adviser.
Exchange Traded Funds (“ETFs”) are bought and sold through exchange trading at market price (not NAV) and are not individually redeemed from the fund. Shares may trade at a premium or discount to their NAV in the secondary market. Brokerage commissions will reduce returns. Investments involve risk. Principal loss and fluctuation in value is possible.
The Securities and Exchange Commission (“SEC”) does not approve or disapprove of any investment. This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy, or investment product. The opinions and views expressed on this website are as of the date published and are subject to change. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No forecasts can be guaranteed. Opinions and examples are meant as an illustration of broader themes, are not an indication of trading intent and may not reflect the views of others in the organization. It is not intended to indicate or imply that any illustration/example mentioned is now or was ever held in any portfolio. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission.
This Fund is a managed ETF that does not seek to replicate the performance of a specified index. The Fund may not meet its investment objective based on the Adviser’s success or failure to implement investment strategies for the Fund. The Fund’s advisor is Hill Investment Group LLC doing business as Longview Research Partners.
The Fund is new with no operating history as of the date of its prospectus. As a result, prospective investors have no track record or history on which to base their investment decisions. Value investing is subject to the risk that the intrinsic values of investments may not be recognized by the broad market or that their prices may decline. Investments utilizing quantitative methods may perform differently than the market as a result of characteristics and data used and changes in trends. The past performance of the Fund’s portfolio manager with respect to any other fund or account is no guarantee of future results.
The Fund is generally available only to shareholders residing in the United States. As such, the Fund requires that a shareholder and/or entity be a US citizen residing in the United States or a U.S. Territory (including overseas U.S. military or diplomatic addresses) or a resident alien residing in the United States or a U.S. Territory with a valid U.S. Taxpayer Identification Number to purchase shares in the Fund. Nothing on this website should be considered a solicitation to buy or an offer to sell shares of the Fund in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction.
