All you want in an IRA is yield (at reasonable risk, which is subjective to everyone). In a taxable account, you need to use the ROC figure given every year to reduce your average cost per share. And only report the non-ROC portion of the annual dividend paid as taxable. If you hold for a long time, its possible your average cost could be reduced to zero. In that case, all dividends paid throughout the year are taxed as long term cap gain (max 20% currently).