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It has a tax benefit too. Dividends are taxed at a higher rate compared to capital gains.
by samfisher83 10y ago
It has a tax benefit too. Dividends are taxed at a higher rate compared to capital gains.
- sokoloff 10y agoNot generally. https://news.ycombinator.com/item?id=12811433 https://news.ycombinator.com/item?id=12811433
- tanderson92 10y agoThere is the unmentioned benefit that if you die your stock receives a step-up in basis while you have no such choice with a qualified dividend. It's fair to say that a capital gain is strictly better tax-wise than a dividend. Qualified dividends are also a nuisance when you are trying to reduce MAGI for various reasonable tax-planning reasons.
- sokoloff 10y agoI agree with that. What I was trying to correct was a common misconception that "dividends are taxed as ordinary income, and LTCG are taxed at a wildly different rate".