Want $15,000 a Year on $100K? This Nasdaq Income ETF Out-Pays JEPQ

Income investors own the JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ:JEPQ) for one reason: a Nasdaq-100 portfolio that pays a high monthly distribution from an options overlay, cheaply. Its 0.35% net expense ratio is among the lowest in the active covered-call category, and holders get the same mega-cap tech names that drive the index, led by NVIDIA at 7.1%, Apple at 6.1%, and Alphabet at 5.3%. The question is whether it is still the best Nasdaq income vehicle for someone who cares most about the monthly check. A newer rival, the NEOS Nasdaq-100 High Income ETF (NASDAQ:QQQI), pays a higher distribution on the same index, though that bigger check comes with a catch worth understanding.

What JEPQ Actually Pays

JEPQ distributed $6.25232 per share in 2025, up from $5.39331 in 2024. At today’s $59.49 price, that is a trailing yield near 10.5%, about $10,500 a year on $100,000. The latest monthly payment, $0.56444 on June 1, 2026, annualizes closer to 11.4%, or roughly $11,400. Most of that comes from equity-linked note income, which the IRS taxes as ordinary income, so high-bracket holders give up a meaningful slice outside an IRA or 401(k). That gap is what a competitor attacks.

The Higher-Paying Alternative: QQQI

QQQI chases the same Nasdaq-100 universe but writes index call spreads instead of single-stock calls or equity-linked notes. Its filing sets an aspirational 19% to 23% target, but the realized number is what counts: the current fact sheet shows 13.63% as of June 11, 2026. On $100,000, that throws off roughly $13,600 a year, ahead of JEPQ, paid monthly. Its latest payment, $0.6589 on May 20, 2026, annualizes near 14.2% at a $55.75 price.

Read the Distribution Before You Chase It

Here is the catch that changes the math: a high distribution rate is not high income. In a recent month, roughly 98% of QQQI’s payout was return of capital. That hands back your own principal, lowers your cost basis, and defers tax, but it is not income, and persistent ROC can erode NAV if option premium underperforms. QQQI’s 30-day SEC yield of -0.02% is the tell: the fund pays out far more than its holdings earn, filling the gap with option premium and return of capital. Treat the ~14% as a distribution rate, not a guaranteed $14,000 of income.

The Tax Mechanism, Honestly

QQQI’s option income carries a real tax feature. Because the fund writes options on the index rather than single stocks, that income qualifies as Section 1256 contract income, taxed 60% long-term and 40% short-term regardless of holding period, while JEPQ’s note income is ordinary income. But it ties back to the payout mix: when much of the distribution is return of capital, little is currently taxed as 1256 gains, so the 60/40 edge applies only to the realized option income. For a high-bracket taxable holder, the benefit is real but smaller than the headline rate implies.

What the Higher Yield Costs

Start with fees. QQQI charges 0.68% against JEPQ’s 0.35%, about $330 a year on $100,000. The distribution absorbs it, but it is real money. Then price appreciation. Over the trailing year, JEPQ returned 24.87% and QQQI 24.92%, nearly identical. Year to date, JEPQ is up 7.18% and QQQI 9.81%, while the underlying QQQ is up 16.88%. Both cap upside; QQQI’s call spread keeps a touch more, because the long call participates above the short strike, but the gap is incremental.

Size and Liquidity

JEPQ is the heavyweight, with a massive asset base and razor-thin spreads. QQQI is the newer challenger: it launched in February 2024 and has paid 28 consecutive monthly distributions, but it has not been stress-tested through a brutal drawdown. Treat that gap in operating history as a real risk.

How the Swap Works

In an IRA or 401(k), the trade is simple: sell JEPQ, buy QQQI, no tax friction. In a taxable account it gets messier. JEPQ has compounded roughly 83% since its May 2022 launch, so most long-term holders sit on large unrealized gains, and selling to chase yield can trigger a tax bill that takes years to recoup. Better to keep JEPQ and route new cash, or just the monthly distributions, into QQQI.

Reading the Decision

JEPQ stays a reliable, liquid staple for anyone who wants high Nasdaq income in the 10% to 11% range and accepts ordinary-income tax. QQQI pays more and adds a partial 1256 advantage, but the bigger number comes with a thinner record and a payout that has leaned heavily on return of capital. For a tax-deferred account or a high-bracket holder who prizes the monthly check and understands the ROC math, the swap makes sense. If your goal is capital appreciation, be wary: a distribution this size can eat into principal.