Portfolio manager charges 1% and I incur capital gains tax?

You will still realize some of the capital gains throughout the year with VOO. The ETF will pay distributions for the dividends and the net capital gains triggered throughout the year. ETF’s and mutual funds will pass this income on to each individual investor through distributions so it’s not taxed by the fund itself. If you’re in Canada and this is in a non-registered account you will be issued a T3. Not sure about US tax slips. This does not mean all capital gains are paid every year, just the ones triggered by any rebalancing within VOO. You will continue to accrue unrealized gains that will be triggered when you do eventually sell some/all of your position. Just like you’d only pay on the gains triggered by the selling of your broker, not the unrealized gains.

/r/investing Thread Parent