This is one of the most common questions people don't ask out loud, because they assume the answer is going to be complicated or costly. In many cases, it isn't.
The short version: most investment accounts can move from one advisor or firm to another without triggering taxes, if it's done correctly. The process is called an in-kind transfer, and it means your holdings move as-is rather than being sold first. But "most cases" leaves room for exceptions that are worth understanding before you do anything.
What an In-Kind Transfer Actually Means
When you move a standard taxable brokerage account or a retirement account, the assets don't have to be liquidated. Your stocks, bonds, ETFs, and mutual funds move from your old custodian to your new one as the same holdings. No sale occurs, which means no taxable event.
The formal mechanism for this is called an ACAT transfer — Automated Customer Account Transfer. It's an industry-standard process that most major custodians support and typically takes one to two weeks to complete. During the transfer, your account may be temporarily restricted from trading, but the assets remain yours throughout. If you've been wondering whether switching advisors means selling everything and starting over, the answer in most cases is no — and this plain-English guide to moving a portfolio without selling everything walks through exactly how the process works.
When Taxes CAN Happen
There are situations where a transfer can trigger taxes, and it's worth knowing what they are before you initiate anything.
First: if the old firm holds proprietary funds — mutual funds that are exclusive to that platform and can't transfer to outside custodians — those positions may need to be sold. The taxable gain or loss on those positions would be reportable in the year of the move.
Second: some managed account structures involve securities bundled inside the firm's own wrap accounts or model portfolios. Moving out of those structures sometimes requires liquidation.
Third: if you choose to move cash rather than securities — which some people prefer for simplicity — you'll trigger capital gains on any positions sold. That's a choice, not a requirement, but it's worth being clear about before you sign anything.
The right move before initiating any transfer is to get a full picture of what you hold, whether any of it is proprietary, and what the tax impact of moving in-kind versus liquidating would look like. Your tax return can tell an advisor a lot about where the exposure is — this piece on what your tax return reveals to a financial advisor explains what that analysis actually involves.
What About IRAs and Retirement Accounts?
IRAs, Roth IRAs, SEP IRAs, and similar accounts are straightforward. Because these accounts grow on a tax-deferred or tax-free basis, the assets inside them can move via a trustee-to-trustee transfer without any tax impact whatsoever. There's no distribution, no withholding, and no filing requirement tied to the transfer itself.
The same is generally true for 401(k) rollovers when you're leaving an employer, though those involve a different process — rolling the account into an IRA at your new custodian rather than a direct firm-to-firm transfer. If you're weighing whether to roll over a large 401(k) or leave it where it is, this guide on rolling over a $1M+ 401(k) in retirement covers the key considerations on both sides.
What About Trust Accounts?
Accounts held in trust can transfer in-kind, but there are a few additional steps involved. The new custodian will need to verify the trust documents and confirm that the trustee has authority to make the move. In some cases, the trust documents may need to be reviewed before the transfer can proceed. The assets themselves don't need to be liquidated, but the paperwork is more involved than a standard individual account — and it's worth making sure your estate documents are current before initiating anything. For a broader look at how trusts and estate structure interact with your financial accounts, this overview of trusts vs. wills in estate planning is a useful starting point.
What About Annuities?
This one requires care. If you hold a variable or fixed annuity, the underlying contract is an insurance product, not a security, and it may or may not be able to move to another custodian directly. In some cases, a 1035 exchange may be available to move the annuity to a comparable product without triggering taxes — but this requires analysis specific to your contract. Don't assume an annuity transfers like a brokerage account.
The Hidden Cost of Staying
Tax concerns shouldn't be what keeps someone in an advisor relationship that isn't serving them well. The tax consequences of a properly executed transfer are often minimal — sometimes zero. The more meaningful question is what it costs to stay.
If you're in a relationship where you're paying for active management that isn't adding value, or working with a firm that isn't operating as a fiduciary, or simply not getting the coordinated planning your situation calls for — the compounding effect of that mismatch over time is real. Understanding how transfers actually work removes one of the most common barriers to making a change that's genuinely in your interest.
It's also worth knowing what to look for when evaluating whether your current structure is actually working. If you're asking whether target-date funds, robo-advisors, or a DIY approach is still appropriate for where you are, this piece on the pitfalls of those approaches for larger portfolios addresses that question directly.
What the Right Advisor Relationship Looks Like
For families with significant assets, the bar for what a financial advisor should provide goes well beyond investment selection. It includes coordinated tax planning, estate alignment, proactive planning around RMDs and Roth conversions, and an advisor who functions as a true fiduciary — legally required to act in your interest, not their firm's.
If you've been curious about what working with an independent fiduciary asset management practice actually looks like, this page on our approach to serving high-net-worth families explains how we work and who we work best with.
Thinking about making a change but not sure where to start? We work with families throughout the St. Louis area who are evaluating their current advisory relationships — and we're happy to walk through what a transition would actually look like for your specific situation, with no obligation.
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John Wahl is a CFP® and ChFC®, co-founder of One Bridge Wealth Management, and was named to the Forbes 2025 Best-In-State Next-Gen Wealth Advisors list. One Bridge is a fee-based independent wealth advisory practice serving high-net-worth families in the St. Louis area. One Bridge Wealth Management acts as a fiduciary when managing assets. John was named to Forbes' Best-In-State Next-Gen Wealth Advisors list — one of the most competitive independent rankings in the financial advisory profession. View the full list2025 Forbes Top Next-Gen Wealth Advisors, created by SHOOK Research. Presented in Aug 2025; based on 03/31/25 data. Advisors pay a fee to hold out marketing materials . Not indicative of advisor’s future performance. Your experience may vary. This content is for informational purposes only and does not constitute personalized tax or investment advice. Please consult a qualified tax professional regarding your specific situation.