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geezer78
New Member

Are reinvested dividends taxed twice, once when received and once when sold?

 
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IreneS
Intuit Alumni

Are reinvested dividends taxed twice, once when received and once when sold?

Because there was an actual cash dividend, although reinvested, it is considered to be income and thus taxable. And, as with any stock, capital gains from shares held in a dividend reinvestment plan (DRIP) are not calculated and taxed until the stock is finally sold, usually several years down the road.

 

[Edited | 3/31/2020 |  9:50am PDT]

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IreneS
Intuit Alumni

Are reinvested dividends taxed twice, once when received and once when sold?

Because there was an actual cash dividend, although reinvested, it is considered to be income and thus taxable. And, as with any stock, capital gains from shares held in a dividend reinvestment plan (DRIP) are not calculated and taxed until the stock is finally sold, usually several years down the road.

 

[Edited | 3/31/2020 |  9:50am PDT]

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

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