[spunkets]

"dividends are reinvested and every year we get a statement and pay taxes on those dividends."

Generally these should just be rolled over into the account. Taxes are normally only paid when a check is sent to you and not reinvested.

[VA40]

Dividends, even if reinvested, are considered taxable in the year received, unless inside an IRA or other tax deferred account. I believe he is referring to his after tax investments.

[sun7]

“Generally these should just be rolled over into the account. Taxes are normally only paid when a check is sent to you and not reinvested.”

I believe taxes on the dividends are due once they are declared even though they are reinvested in the account.