Beware Phantom Dividend Cuts

(Editors' Note: This article covers a micro-cap stock. Please be aware of the risks associated with these stocks.) Fiscal Cliff Hangover A year ago, Congress was embroiled in the debate over whether to extend the favorable tax rates on dividends and capital gains, which were set to expire at the end of 2012. The looming prospect of higher taxes, which included other items in the tax code, was referred to as the Fiscal Cliff and, understandable, was producing great anxiety among many taxpayers, including investors, who faced the prospect of paying "ordinary" taxes on such income. As politicians often do, our representatives seemed bent on putting off a decision until the last possible minute, leaving us all with uncertainty about whether to make any changes to our portfolios. (A similar process in 2010 had resulted in a two-year extension of the tax rates, but an agreement was reached in early... Read more