The NEOS S&P 500 High Income ETF (SPYI) offers a 12% monthly distribution, but about 96-97% of these payments are classified as return of capital, not taxable income. This means investors receive a refund of their investment principal, which reduces their cost basis and defers taxes until they sell the shares or the basis hits zero. Older investors holding SPYI in taxable accounts and planning to leave shares to heirs benefit most, as heirs get a stepped-up cost basis that can eliminate deferred gains. Younger investors or those without estate plans may face larger tax bills later. Consulting a tax professional is advised before investing for estate planning purposes.
If you retire before age 62, Social Security won't pay benefits until then, leaving a gap in income. Three ETFs—SPYI, DGRW, and HDV—offer monthly or quarterly dividends to generate income during this period. SPYI provides high monthly yields through ...
Covered-call ETFs offering 8%+ yields generate mostly non-qualified income taxed at ordinary rates in taxable accounts, reducing net returns. Holding four specific ETFs—SPYI, JEPI, JEPQ, and DIVO—in a Roth IRA shields investors from these taxes, pres...
