Tax implications for shareholders
A cash dividend of $0.02 per share is treated as ordinary income in the United States. For most individual investors the amount is tax‑exempt from federal income tax because it falls below the de‑minimis threshold for reporting (the IRS requires reporting only if the total dividend exceeds $10 for the year). However, the dividend is still subject to state and local income taxes in jurisdictions that tax dividend income, and it must be reported on the shareholder’s tax return if the aggregate amount from all dividend‑paying securities exceeds the reporting threshold.
If you hold the shares in a tax‑advantaged account (e.g., an IRA, 401(k), or a qualified HSA), the dividend is automatically sheltered from current taxation and will be taxed only upon qualified distributions. For tax‑able brokerage accounts, the dividend is reported on Form 1099‑DIV (Box 1a) in the following year’s tax filing. Because the dividend is modest, the marginal tax impact is negligible for most investors, but it should still be recorded to avoid discrepancies with the broker’s year‑end statements.
Trading considerations
From a market perspective, a $0.02 dividend on a low‑priced, thinly‑traded stock like Table Trac (OTCQX: TBTC) is unlikely to move the price materially; the ex‑dividend date (Aug 29) may see a small, predictable price drop equal to the dividend amount, adjusted for normal market volatility. Technical charts show the stock trading in a tight range with modest volume, so the dividend does not create a new catalyst. Fundamentally, the payout signals a modest cash‑flow surplus but does not materially improve valuation metrics.
Actionable insight – If you are a long‑term holder in a taxable account, the dividend’s tax cost is minimal, so there is no need to adjust your position solely for tax reasons. If you are a short‑term trader, be aware of the expected ex‑dividend price adjustment (≈ $0.02) and factor it into any stop‑loss or entry orders around Aug 29. Holding the shares through the record date (Aug 29) secures the dividend; otherwise, you can avoid the tiny tax reporting requirement by selling before the ex‑dividend date.