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Investors & landlords
Actually, if you pay taxes on the dividends you receive each year, your cost basis in the mutual fund goes up each year by the amount of the annual dividend.
When you reinvest dividends in a non-retirement mutual fund, you are buying additional shares of that fund. The "cost basis" of the additional shares is the taxable dividend you reinvested.
May 31, 2019
9:27 PM