Word: iras
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...smart move has long been to hold high-yielding stocks or stock funds in an IRA or 401(k) in order to shield dividends from income tax. But the Bush plan would penalize investors for continuing to do so. How? When you take a distribution from your IRA, you pay income tax on the entire amount. So any dividends paid into an IRA would ultimately become taxable. Yet in a taxable account, dividends would be tax free. Got that? Well there's more, and it makes a mockery of the notion that tax reform makes things simpler...
...smart move has long been to hold high-yielding stocks or stock funds in an IRA or 401(k) in order to shield dividends from income tax. But the Bush plan would penalize investors for continuing to do so. How? When you take a distribution from your IRA, you pay income tax on the entire amount. So any dividends paid into an IRA would ultimately become taxable. Yet in a taxable account, dividends would be tax free. Got that? Well there's more, and it makes a mockery of the notion that tax reform makes things simpler...
...PREFERRED STOCK Traditional preferreds would win big. With tax-free yields of 7% or so, they would be a bargain. But more common hybrid preferreds, which pay higher yields, would remain taxable. As with most bonds, stick them in an IRA...
...MUNIS AND REAL ESTATE INVESTMENT TRUSTS (REITS) Both losers. Why buy a municipal bond when you can get a higher yield and only modestly more risk with a tax-free preferred stock? REIT dividends would remain taxable. They make sense only in an IRA...
...Mart's centralization of power at its headquarters in Bentonville, Ark., could produce agitation among the managers of its stores, who have traditionally been granted considerable independence in stocking what locals want. And consumers get bored by one-size-fits-all merchandise. Says Ira Kalish, an analyst for consultancy Retail Forward, in a mostly bullish report on Wal-Mart: "Excessive size could breed bureaucracy as well as failures in the areas of merchandising and customer relations...