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This is why companies issue Dividend Tax Status Reports.

I don't know why it isn't on their website, but if you hold your stock in a brokerage account, you probably already have the 1099 that can answer your questions.

I've held O in two different accounts this year, but for one of them I find:

Dividends: 88.58 % (box 1)
Cap gains (20%) rate: 1.26 % (box 2a)
Unrecap Gains (1250): 0.63 % (box 2c)
Return of capital : 10.75 % (box 3)

WARNING : ROUNDING ERRORS

The percentages are of the total distributions from Realty Income.

Note that "return of capital" is not taxed at all (it's your money coming back) but it DOES reduce your cost basis.

On the topic of DRPs, Realty Income is the only company which I dividend-reinvest. The high yield and monthly payout make the monthly compounding add an extra half-percent to the effective yield. It's only too bad that the stock price has been moving in the wrong direction this year. Schwab allows free reinvestment.

- Danny
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