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Academy Sports and Outdoors Employees: Smarter Ways to Manage Taxes on Appreciated Stock

Healthcare Provider Update: Healthcare Provider for Academy Sports and Outdoors Academy Sports and Outdoors employs various healthcare providers for its employees, with UnitedHealthcare being one of the prominent insurers offering plans through the Affordable Care Act (ACA) marketplace. Given the company's extensive workforce, they seek competitive healthcare solutions that cater to the diverse needs of their employees across different states. Potential Healthcare Cost Increases in 2026 As the landscape of healthcare costs evolves, 2026 is poised to bring significant challenges for consumers, particularly those enrolled in ACA plans. Experts anticipate sharp premium increases, with some states experiencing hikes exceeding 60%, primarily due to the expiration of enhanced federal premium subsidies and rising medical costs. The Kaiser Family Foundation warns that without legislative action, roughly 22 million marketplace enrollees could see their out-of-pocket costs soar by over 75%. This perfect storm of factors not only threatens affordability but also exacerbates access to vital healthcare services for millions. Click here to learn more

'Academy Sports and Outdoors employees with concentrated stock positions may benefit from thoughtful tax planning that allows for tax deferral while balancing liquidity, compliance, and long-term compounding,' Wesley Boudreaux, a representative of The Retirement Group, a division of Wealth Enhancement.

'Academy Sports and Outdoors employees who hold highly-appreciated stock may want to consider tax-efficient strategies that help mitigate their liabilities while aligning with their overall retirement goals,' Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

How taxes can affect investment returns, particularly on concentrated stock positions.
Exchange funds and options-based strategies as methods for tax deferral and diversification.
Alternative planning techniques outside ETFs, including charitable trusts and gifting strategies.

By Carlos Hernandez, Wealth Enhancement advisor

When it comes to driving portfolio returns, many investors aim to keep management fees low by investing in low-cost index funds and exchange-traded funds (ETFs). While fees matter, however, the real culprit for lower-than-anticipated performance is taxes. ¹

Wealth Enhancement advisor Carlos Hernandez explains: 'By losing less to taxes each year, investors have access to more capital that can continue to compound over time. This makes tax deferral an important part of an effective financial plan.' Academy Sports and Outdoors employees looking for long-term growth strategies could benefit by understanding how to better manage their investment tax burdens.

Trade Money

One area where taxes can take a toll is on the sale of company stock or other concentrated investment positions. Academy Sports and Outdoors professionals looking to diversify could face significant capital gains taxes on an outright sale. One way to diversify without triggering immediate capital gains is through exchange funds. By contributing their highy-appreciated stock to a pooled fund, investors can trade their concentrated holdings for shares in a diverse basket of securities. This method can be used by Academy Sports and Outdoors employees who want to diversify while postponing taxable events.

Although this method allows for tax deferral, it also requires investors to hold the exchange fund for a period of time, typically seven years. ² This could create a challenge for investors who require liquidity. Additionally, these funds are often exclusively accessible to wealthy, accredited investors—something Academy Sports and Outdoors executives should carefully evaluate.

Funds Based on Options

Another way to mitigate taxes on the sale of highly-appreciated stock is by using options contracts. The idea is to hedge risk with put options while covering the cost of those puts by selling call options—a strategy called 'collaring'. From there, the strategy reverses, with investors selling put options and using the proceeds to buy call option on an equity or bond index. ³ If managed effectively, this helps to diversify a concentrated portfolio while still maintaining liquidity.

Given the complexity of this strategy, meticulous planning is necessary. It's generally recommended that investors work with an experienced financial advisor before pursuing this approach.

Things to Be Aware of

Although these strategies can be beneficial for Academy Sports and Outdoors employees who hold highly-appreciated stock, caution is recommended. There are costs associated with these approaches, and potential liquidity risks. Additionally, the IRS may eventually contest such arrangements because their tax status has not been thoroughly examined—something Academy Sports and Outdoors retirees should keep top of mind.

'Tax drag reduction strategies can be effective, but they must be assessed through the lens of risk, liquidity, cost, and compliance,' warns Carlos Hernandez. What is appealing in theory must hold up to inspection in the real world.

Alternative Strategies

Although they show promise, investors with highly-appreciated stock or those looking to postpone gains have other alternatives besides exchange funds or options. Other tactics could include:

- Prepaid variable forwards (subject to IRS regulations, contracts to sell at predetermined terms in the future).
- Charitable remainder trusts (CRTs), which allow investors to donate appreciated stock to a charitable trust and receive a stream of regular income in return.
- Donor-advised funds (DAFs), which provide investors with a tax deduction for the fair market value of the appreciated stock they donate.
- Other gifting techniques, such as direct donations to charity or family.
Each has its own set of guidelines, advantages, and disadvantages. To limit unnecessary taxes or violating the constructive sale regulations, careful planning is necessary for Academy Sports and Outdoors professionals managing complex portfolios.

The Bottom Line

Although the movement to mitigate the tax burden on investments is not new, the instruments are changing. Both exchange funds and options-based structures offer investors a way to manage tax liabilities, especially for Academy Sports and Outdoors employees who hold highly-appreciated stock.

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In the end, taxes are unavoidable. However, with the correct set of instruments, they can be controlled and postponed. 'The real value comes from aligning tax strategy with investment strategy,' summarizes Carlos Hernandez.

Sources:

1. BlackRock Advisor Center. ' Investing for After-Tax Returns ,' 2025.

2. Kiplinger. ' Four Clever and Tax-Efficient Ways to Ditch Concentrated Stock Holdings ,' by Robert Waskiewicz. Sep. 11, 2025.

3. Financial Planning Association. ' Tax-Efficient Ways to Diversify Concentrated Stock Positions ,' by Peter Lazaroff. Oct. 2024.

What type of retirement savings plan does Academy Sports and Outdoors offer to its employees?

Academy Sports and Outdoors offers a 401(k) retirement savings plan to its employees.

Is there an employer match for the 401(k) plan at Academy Sports and Outdoors?

Yes, Academy Sports and Outdoors provides an employer match for contributions made to the 401(k) plan, subject to certain limits.

How can employees at Academy Sports and Outdoors enroll in the 401(k) plan?

Employees can enroll in the 401(k) plan at Academy Sports and Outdoors through the company’s benefits portal or by contacting the HR department for assistance.

What is the eligibility requirement for Academy Sports and Outdoors employees to participate in the 401(k) plan?

Most employees at Academy Sports and Outdoors are eligible to participate in the 401(k) plan after completing a specified period of service.

Can employees at Academy Sports and Outdoors take loans against their 401(k) accounts?

Yes, Academy Sports and Outdoors allows employees to take loans against their 401(k) accounts, subject to the plan’s terms and conditions.

What investment options are available in the Academy Sports and Outdoors 401(k) plan?

The 401(k) plan at Academy Sports and Outdoors offers a variety of investment options, including mutual funds, stocks, and bonds.

Does Academy Sports and Outdoors allow for hardship withdrawals from the 401(k) plan?

Yes, Academy Sports and Outdoors permits hardship withdrawals from the 401(k) plan under certain circumstances as defined by the plan.

What is the vesting schedule for employer contributions at Academy Sports and Outdoors?

The vesting schedule for employer contributions at Academy Sports and Outdoors is outlined in the 401(k) plan documents, typically based on years of service.

How often can employees change their contributions to the Academy Sports and Outdoors 401(k) plan?

Employees at Academy Sports and Outdoors can change their contribution amounts to the 401(k) plan during designated enrollment periods or as permitted by the plan.

What resources are available for Academy Sports and Outdoors employees to learn more about their 401(k) plan?

Academy Sports and Outdoors provides resources such as informational seminars, online tools, and access to financial advisors to help employees understand their 401(k) plan.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Academy Sports and Outdoors has announced a restructuring plan involving a reduction in workforce across various departments. The company is also implementing changes to their benefits package, including adjustments to health insurance coverage and 401(k) matching contributions.

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For more information you can reach the plan administrator for Academy Sports and Outdoors at 1800 North Mason Road Katy, TX 77449; or by calling them at (281) 646-5200.