I logged into my Sharebuilder account to get my latest balance, and noticed that there were 4 little cents hanging out in the money market fund there. I wondered where those came from, since all of my money should have been invested in various stocks already. Or so I thought. A couple of clicks gave the answer.
I’d forgotten about dividends.
Which is kind of silly, since many of the stocks I bought do pay dividends. Oh well, it was a pleasant surprise to receive a dividend, even if it was only a 4 cent surprise at this stage.
That did get me thinking though, what are the tax consequences of receiving dividends? Do I have to track them specially? If I reinvest them, are they treated differently? I hit up the IRS web site, which told me that I’d essentially just better keep track of everything about them so that I can report them correctly. Here are the links I checked, if you’re interested:
Time to set up some more file folders for tax purposes.