Investing: How to Play the Tax Plan

The President's proposal to eliminate double taxation on stock dividends is a magnum opus of confusion. Want proof? It took Wall Street nearly a week to grasp one of the plan's most fundamental notions: shareholders would be no better off tax-wise with companies that pay a dividend than with those that do not. Still sinking in: dividend investors might even be hurt in the short run because the Bush plan makes it silly to own such stocks in tax-favored accounts, where most people invest.

The smart move has long been to hold high-yielding stocks or stock funds in an IRA or...

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