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Home/News Feed/Holding BDCs and mortgage REITs in a Roth IRA saves significant taxes on high ordinary income dividends.
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$16.23
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Holding BDCs and mortgage REITs in a Roth IRA saves significant taxes on high ordinary income dividends.

Market News
26 Aug 2026
24/7 Wall Street
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Bullish
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Business Development Companies (BDCs) and mortgage REITs distribute dividends taxed as ordinary income, often at high rates like 24%. Placing these high-yield stocks such as MidCap Financial, Blue Owl Capital, and ARMOUR Residential REIT in a Roth IRA eliminates the tax on their non-qualified dividends, saving thousands annually. Over time, this tax saving compounds, making Roth placement financially advantageous, especially for investors in higher tax brackets. Investors are advised to review their taxable accounts and consider Roth conversions to maximize tax efficiency on these income streams.

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Rithm Capital and Annaly Capital favored for strong dividends and valuation in mortgage REITs analysis

Rithm Capital and Annaly Capital favored for strong dividends and valuation in mortgage REITs analysis

Rithm Capital stands out with strong dividend coverage and a notable discount to book value, making it a preferred choice among mortgage REITs. Annaly Capital also receives a Buy rating due to consistent dividend coverage and improving fundamentals, ...

Analyst Insights
Neutral
3 days ago
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