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Jacqueline earned $150 in cash dividends from a stock investment, reported to her on Form 1099-DIV. She had previously elected to have these dividends reinvested.

Jacqueline earned $150 in cash dividends from a stock investment, reported to her on Form 1099-DIV. She had previously elected to have these dividends reinvested. Choose the response that correctly completes the following sentence. The reinvested dividends are A. Nontaxable income until the stock is sold, B. Taxable on her current year return, but her basis in the stock does not change, C. Taxable on her current year return, and her basis in the new shares purchased is the cash value of the dividends, D. Not taxable on her current year return, but the new shares purchased increase the basis in the stock

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