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Not exactly sure what you mean by writing stuff off, but the rest is fairly straight forward.

Tax laws change regularly, but at the moment, gains on stocks (or anything) held less than a year is short term and taxed at your regular tax rate, held a year and a day or more is long term and is taxed at 15% (or 5% if your regular tax bracket is already 15% or lower), dividends are taxed at 15% (can drop to 5% also). There's no difference on taxing dividends if you get them or they are reinvested. You still pay taxes on the money you got. Of course, none of this is true in tax-free retirment accounts.

Oh, and while Lynch does say that stalwarts/blue chips, cyclicals, etc can all be money making machines, his highest recommendation is most certainly not blue chips ;)

Finally, you may want to start some reading here and then follow up with any further questions:
http://www.fool.com/taxes/taxcenter/taxcenter.htm?source=LN
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