REIT Reinvesting


I own a REIT (STAG) in a traditional IRA and have previously reinvested dividends. Is it allowed to stop reinvesting the dividends and place the cash into my core account? Secondly, is this added cash to the core account considered an IRA contribution towards the $6,000 allowed yearly?

Thank you for taking the time to review my question.


Hi Moooohead,

You can either reinvest the dividends or allow the cash to accumulate. Purely your choice.

I let the cash accumulate to either manually invest or to withdraw for expenses.

Keep in mind:

Contribution: Cash that is sent from the taxable world into a retirement account from wages, tips, commissions, etc.

Contributions cross the boundary from the outside, taxable world to the inside world of the retirement account where taxes are either deferred or eliminated.

Cash that is made inside of a retirement account by sales, dividends, interest, etc is just cash in the retirement account. At that point, it has no special status.

Does that help you?

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Thank you for responding to my question.

I like how you explain the “Keep in mind” sections.

The REIT dividends are being made inside the retirement account into the core account which is inside the retirement account. From what you stated then I can reinvest that money anyway I wish without taxes until I make distributions in retirement.

Thank you.