Definitions for "Reinvested dividends"
Dividends that are reinvested by the shareowner to purchase additional shares in a mutual fund. These dividends are fully taxable and become part of the cost basis of shares held in the account.
Fund investors have the option of receiving payouts for any dividends generated by the securities in funds they own, or reinvesting the income represented by the dividends in the form of purchases of new shares of the fund. Most reinvest by checking a little box when they buy the fund.
These are dividends that are reinvested by a mutual fund to buy additional shares. Reinvested dividends are fully taxable (listed on IRS Form 1099-DIV), even though they are not taken as a cash distribution. They become part of your cost basis.