How do I know if ETF dividends are qualified?
Asked 3 years ago
So I'm relatively new, and I think that dividend-paying investments would be the best way for me to go. However, looking at ETFs that are dividend-paying, I see that they need to qualified? What does this mean? How do I know whether the ETF is qualified or not?
Andia Rispah Igobwa
Tuesday, July 06, 2021
Dividends are qualified when they meet the below requirements:
- There is a declaration date and dividend record date on or before the ex-dividend date of an eligible security
- The dividends must be payable by US companies (unless usually paid in cash, treasury stock, publicly-traded equity securities)
- The company must be a regulated public utility and the company needs to have paid at least half of its normal dividend amount over the past four quarters going back from the current quarter while also not paying any type of unreasonable distribution such as dividends each month or what some call cumulative capacity demand charge type funds during this time frame.
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