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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (60790)	8/7/2002 10:18:55 AM
From: Ira Player	Read Replies (1) \| Respond to of 77400

It's not just that they tax the dividend...it's that it's taxed at the marginal tax rate. Buying back shares still distributes the 5% in my example, but only the people that sell are immediately impacted by the action and they only pay for the difference between the price received and the price paid. Possibly at Long Term rates. The rest of the money is a return of capital and has no tax consequences. This is a large advantage. Now if dividends could be considered a return of capital, lowering your basis...I might change my mind on dividends. Ira