Tax Playbook · Investment tax wins
REITs belong in retirement accounts
Most REIT payouts are taxed like your paycheck, not like regular stock dividends. A $2,000 REIT payout in the 24% bracket costs about $480 in tax in a regular account, but $0 inside a Roth IRA. A 20% deduction on REIT payouts softens the hit in a taxable account, but the retirement account usually wins. Use this only when you have the retirement space to spare.
Good for: Investors who own REITs or REIT funds.
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Recent articles & guides
- Motley Fool — where to hold BDC and REIT income (Sep 2026)
- Dividends Times — REIT dividends in a Roth IRA (Aug 2026)
- Stockember — REIT meaning and how they work
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Educational summary, not tax advice. Limits and rules change — confirm current law with your tax adviser.