NUA Stock Dividends
I have employer stock in my 401k and if I’d take the dividends now instead of reinvesting I believe they would be treated as ordinary income. If I would take this stock out of the plan in a rollover under NUA treatment, would future dividends continue to be ordinary income or would they then be considered qualified dividends?
Permalink Submitted by Alan - IRA critic on Sun, 2019-07-14 20:57
Once the shares are in your taxable brokerage account, additional dividends generated are eligible for qualified dividend treatment. They are no longer 404k dividends or reported on a 1099R.