$200,000 in Dividend Stocks: How Much More Could You Keep in a Roth IRA?

At the 24% bracket, an equal-weight $200,000 portfolio of six well-known dividend payers returns about $10,150 a year and sends roughly $1,690 of it to the IRS. Inside a Roth IRA, any qualified distribution “shall not be includible in gross income” (26 U.S.C. § 408A(d)(1)), so the full amount stays put.

Roth Versus Taxable: $1,690 a Year at the 24% Bracket

Each holding gets $33,333. Qualified dividends carry capital gains rates of 0%, 15% or 20% (26 U.S.C. § 1(h)(1)), meaning 15% for most 24% bracket filers on five of these names. Realty Income (NYSE:O) is the exception: a REIT can pass through qualified dividend treatment only on amounts it specifically specifies (26 U.S.C. § 857(c)(2)(C)), so most of its payout gets taxed at the full 24%. The estimates take out any Section 199A deduction on REIT dividends, state income tax, and the net investment income tax.

Each year, the Roth ends up $1,690 ahead. Over 10 years, with no new money and no growth, that adds up to $16,900.

Six Holdings Ranked by Roth Payoff

• Realty Income: yields 5.67%, or $1,890 a year. Its ordinary-income payout costs $454 in tax, which is 27% of the portfolio’s total tax bill. It covers its dividend with room to spare: 2026 AFFO guidance is $4.44 to $4.45 per share against a $3.258 annualized dividend.
• Verizon (NYSE:VZ | VZ Price Prediction): yields 6.57%, the highest of the six, which makes $2,190 a year and $328 in tax. Free cash flow reached $18 billion through nine months, while dividends paid totaled $8.8 billion.
• Altria (NYSE:MO): yields 5.71%, or $1,900 a year. It raised the quarterly payout to $1.11, and its debt-to-EBITDA is 1.9x.
• Pfizer (NYSE:PFE): yields 5.65%, or $1,880 a year. Management said “the dividend will be maintained” as patents expire, with leverage at 2.7x.
• AT&T (NYSE:T): yields 4.88%, or $1,630 a year. The payout has continued at $0.2775 per quarter since 2022, supported by a 2026 free cash flow target of $18B+.
• Johnson & Johnson (NYSE:JNJ): yields 1.97%, which makes just $660 a year and $99 in tax. It grounds the portfolio for safety, and it has the weakest case for Roth location of the six.

Higher Brackets Lose More of the Same $10,150

The table assumes the 15% qualified rate from 22% through 32% and 20% at 37%. Most of the change across brackets comes from Realty Income. Its tax bill goes from $454 at 24% to $699 at 37%, because its payout is taxed at your top income-tax rate.

Compounding Turns $1,690 Into $50,400

Reinvest the annual tax savings inside the Roth at a conservative 4%, and at the 24% bracket the gap gets to about $20,300 after 10 years and $50,400 after 20. Without reinvestment, the 20-year total would be $33,800. These estimates exclude any share-price appreciation or dividend increases. They capture only the income tax you lose by keeping these six stocks outside a tax-advantaged account.

Three Moves Before Your Next Tax Filing

1. Check your last Form 1099-DIV. Separate ordinary dividends from qualified ones and tax the ordinary portion at your top income-tax rate. REIT holdings like Realty Income usually account for most of it.
2. If you have limited Roth space, give priority to positions that pay ordinary dividends, then to the highest qualified yields such as Verizon. Low-yield names like Johnson & Johnson are the most efficient holdings to keep outside a tax-advantaged account.
3. Before changing over, compare the one-time conversion tax on these specific positions with the annual tax shown in the bracket table above. The quiet period from retirement to your first RMD is often when conversions are cheapest, a window we sized up in a free Roth guide.

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