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The Tax Drag
Quick Check.

Four questions. One honest number: what tax drag is actually costing your portfolio.

Step 1 of 4

How much do you have invested in taxable brokerage accounts?

$1,000,000
$100K$10M+

Taxable accounts only — not IRAs, 401(k)s, or Roth accounts, which don't generate annual tax drag.

Step 2 of 4

What's it mostly invested in?

Individual stocks or low-cost index ETFs
Buy-and-hold, minimal trading
A mix of index and actively managed funds
Some rebalancing, some manager turnover
Mostly actively managed mutual funds
Frequent trading inside the funds

Step 3 of 4

What's your combined federal + state tax rate on investment income?

Under 24%
24% – 32%
32% – 37%
37%+ (including the 3.8% NIIT surtax)

Not sure? Pick your best guess — this only shifts the estimate, not the shape of the answer.

Step 4 of 4

Over how many years do you want to see the impact?

15 years
5 yrs30 yrs

Your Estimate

Calculating…

—
Estimated Annual Drag
—
Lost Over 15 Years

This is a directional estimate based on four inputs — not a full analysis. A real answer requires your actual tax returns, account statements, and cost basis history. That's the work we do.

Prefer to control every input yourself? Try the full Tax Drag Estimator.

What this tax drag calculator estimates

Tax drag is the part of your investment return lost to taxes each year. This quick check uses four inputs, including your tax bracket, the kind of funds you hold, and your time horizon, to estimate your annual drag and what it could cost over time. It is a starting point, not a substitute for reviewing your actual tax return.

For the definition, a worked example on a $1 million portfolio, and the strategies that reduce drag, read our full guide: What is tax drag?

Frequently asked questions

What is tax drag?

Tax drag is the portion of an investment portfolio's return lost to taxes each year — from fund distributions, dividends, interest, and realized gains — rather than the return an investor actually keeps.

How accurate is this quick check?

It's a directional estimate based on four simplified inputs, not a full tax analysis. It's meant to show whether tax drag is likely a meaningful issue for your portfolio, not to replace a review of your actual tax returns and account statements.

Why does fund turnover matter for taxes?

When a fund sells positions to rebalance or replace holdings, it realizes capital gains and distributes them to shareholders — creating a taxable event even for investors who never sold a share themselves. Higher-turnover, actively managed funds generally produce more of these distributions than low-turnover index funds.

Important Disclosure: This tool provides a rough, directional estimate for educational and illustrative purposes only and does not constitute tax, legal, financial, or investment advice. Rubiq Financial Partners is not a tax advisor, CPA, or attorney, and does not provide tax preparation, legal, or accounting services. The estimate assumes a 7.5% average annual gross return and applies simplified turnover and yield assumptions based on your selected portfolio style; it does not reflect advisory fees, transaction costs, your specific holdings, or any particular client's actual results, and is not indicative of future performance. Actual tax drag depends on your specific holdings, cost basis, state of residence, filing status, account structure, and applicable law, all of which are subject to change. Always consult a qualified tax advisor and financial advisor before making decisions based on this estimate.