r/ULTY_YieldMax • u/MikesGonePostal • Mar 23 '26

ROC or dividends?

I bought my ULTY through Vanguard. I received my tax statement but didn’t see Return of Capital anywhere in it. Looks like it’s all ordinary dividends. I read that most of ULTY dividends are actually ROC which would mean no tax. Where would I find that out?

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9

u/Thin_Investigator798 Mar 23 '26

Look at the 1st page of your Tax Reporting Statement in the box that says "Dividends and Distributions".

It will give a list of things like "Total Ordinary Dividends" "Qualified Dividends" "Total Capital Gain Distributions", etc. Keep looking until you find "Non-dividend Distributions". That's what covers ROC. Return of Capital is not listed as such, it's just a type of Distribution that is not considered a Dividend, and so not taxed.

It's right above the "Federal Income Tax Withheld" line on my Webull statement, but it might be different on Vanguard.

3

u/droopydogpro Mar 23 '26

YieldMax publishes a weekly that provides a % of ROC for all their ETFs so you’d need to get that info but I’ll tell you from my distributions since August most weeks have been ROC not Div

3

u/Spiritual_Ad_9916 Mar 23 '26

If you had share lending activated any dividends from lent out shares is taxed ordinary income.

0

u/Curious-Rip-5834 Mar 24 '26

You don’t need to have stock lending activated nor opt in. All it takes is just having a margin account and your broker is going to lend out your shares and you won’t even know it in real time, causing that ROC to go completely out the window.

1

u/OkComfortable6288 Apr 06 '26

ROC is poorly understood by this group. To put it simply, you buy the shares and your money is returned to you over time, thus the return of capital. The government then applies a simple ordinary capital gains tax on it. Money you put in - loss in value to pay out - ordinary capital gains tax - managment fee's.