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I've done some reading, and I'm not positive on the answer (and couldn't find it in the FAQ).

It appears that you have to pay capital gains tax on dividends. Do you still pay the capital gains even if reinvest the dividend in the company?

The dividends a compay pays out are ordinary income, not capital gains. They are taxable to you, even if you choose to reinvest the dividends in more company stock.

Capital gains and losses come from buying and selling the shares, not from the dividends a stock pays while you hold it.

Hope this clears up a bit of confusion.

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