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I started contributing to my employer's 401k last year.
My employer matches my contributions dollar for dollar with company stock. The company stock pays dividends.
I received a 1099 form in January and will have to file a 1040 form for my taxes this year. The dividends count as income. Why? I thought capital gains, dividends, and interest were tax-deferred in 401k's and IRA's. Why must I pay tax on dividends from company stock in my 401k?
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