When you buy DRIP stock, company pay fee for reinvestment, do you have to pay taxes when the company pay out dividens or you have capital gain. If yes, the company will send us all the information that need, right? Thank you, i learn a lot from here
2007-02-05 13:46:44 · 2 answers · asked by think 1 in Business & Finance ➔ Personal Finance
You will receive a tax slip for the dividends received which you will then have to pay taxes for (much less tax then earned interest).
Capital gains would be realized if you sold the stock and at that time you would have to calculate and manually report the gain you made from selling (i.e. subtract the difference from the amount bought from the amount sold to determine the gain). Capital gains is also taxed at a lower rate than earned interest.
2007-02-05 13:59:05 · answer #1 · answered by lg 1 · 0⤊ 0⤋
most of the time you do but it really matters where you live
2007-02-05 21:50:09 · answer #2 · answered by Mr. Avatar: The Last Airbender 2 · 0⤊ 0⤋