Mutual funds sometimes make dividend payments that don't represent earnings. When you receive this type of dividend, you're considered to be getting back some of the money you invested in the company. That's why these payments are called return of capital distributions. But people tend to simply call them nontaxable distributions because in nearly all cases that's what they are: nontaxable. In fact, that's what the IRS calls them, although they can be taxable in limited circumstances.

I think you are wrong. But if it means I get a tax rebate on my dividend , then I hope you are right.