Do Ordinary Dividends Qualify for Drd?

Mutual fund dividends derived from certain domestic corporations may be eligible for the dividends received deduction (DRD) for corporations. A portion of the ordinary income distribution (dividend income plus short-term gain) paid in 2019 by the Funds listed below may qualify for this deduction.

What qualifies for DRD?

Dividend income

The dividends received deduction (DRD) is increased from 70% to 80% if the recipient of the dividend distribution owns at least 20% but less than 80% of the distributing corporation.

Do REIT dividends qualify for DRD?

Under the Internal Revenue Code, a corporate REIT generally computes its taxable income and tax in the same manner as non-REIT corporations, except that a REIT is not entitled to the dividends received deduction (DRD) but is specifically entitled to deduct dividends paid to its shareholders (DPD).