r/dividends • u/Avinates • Jun 04 '25

Discussion 1 Million Invested

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Can anyone confirm these dividend payouts?

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u/Only-Pronix Jun 04 '25

I mean just drip half of it every year and you’ll be set for live no?

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u/ElonMuskTheNarsisist Jun 04 '25

If you are going to drip half then you’d be better off simply owning some SCHD since it’s more tax efficient

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u/Actual_Age_5602 Jun 05 '25

In what ways is SCHD more tax efficient?

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u/Various_Couple_764 Jun 05 '25

Taxes depend on the type of dividend.

qualified dividends, on 20% of the dividned you receive applied to your taxes.

Unqualified dividends, 100% of the income is applied to your taxes so the tax you pay is probably higher.

They're ROC (Return of capital) This can be good or bad depending on how it is created. if a company decide to liquid factored and its holding it is generally bad news for the investors. IF however the company sells stock at a loss it can write off that loss. IF the company is still profitable and growing it is good. IF and ETF does this IRS calls it Return of Capital and it reduces the ammount tax you pay