Walmart Inc.'s hometown posted the nation's highest total for ordinary dividend income per tax filing in 2016, according to Internal Revenue Service records.
Bentonville's 6,430 tax filings in the 72712 ZIP code reported nearly $2.9 billion in ordinary dividends, or about $446,000 each, in 2016, the latest year for which figures are available.
The dividend total for Bentonville is attributed to the presence of offices for Walton Enterprises LLC and the Walton Family Foundation, which together own about half of all Walmart stock. The address for Walmart's headquarters is under Bentonville's other ZIP code, the nonresidential 72716.
The nation's second- and third-highest totals for reported tax-filer dividend income were Miami Beach, Fla., at $410,000, and Palm Beach, Fla., at $244,000, according to an analysis of IRS data by Bloomberg News.
An ordinary dividend is a share of a company's profits paid to a shareholder on a regular basis, usually quarterly or annually. Ordinary dividends are reported to the IRS as ordinary income.
The IRS publishes data on certain income and tax items classified by state, ZIP code and adjusted gross income. Based on individual income tax returns filed with the IRS, the data are available for the tax years 1998, 2001, and 2004 through 2016. The data include dividends, interest earned, wages and salaries, number of personal exemptions and number of returns.
Walton Enterprises holds about 1.4 billion Walmart shares for the the world's richest family, according to the retailer's most recent proxy statement. As the holding company for the family's dividends, it invests the funds through other Walton entities, such as the private equity and venture capital firm Madrone Capital Partners. The foundation is the family's charitable arm, which donates to economic development, environmental and educational projects nationwide.
The three children of Walmart founders Sam and Helen Walton -- Rob, Jim and Alice -- own a total of about 10 million shares and were worth a combined $137 billion as of Tuesday, according to the Bloomberg Billionaires Index. Walmart posted $514.4 billion in revenue in fiscal 2019 and plans to pay a cash dividend for fiscal 2020 of $2.12 per share -- about 2 percent more than the $2.08 per share paid in fiscal 2019.
Walmart's shares fell 54 cents to close Tuesday at $98.69 in trading on the New York Stock Exchange.
Ordinary dividends attributed to Bentonville's 72712 ZIP code in 2016 accounted for most of the $3.68 billion reported for all of Arkansas. A small portion of the remainder went to individual shareholders, said Mervin Jebaraj, director of the Center for Business and Economic Research at the University of Arkansas, Fayetteville. Bentonville's much larger amount is likely helping to fund local projects.
Jebaraj said that nearly all of Bentonville's reported dividend income went to tax-filers with adjusted gross income of $200,000 or more. He said people in lower- and middle-income categories tend to spend their money, mostly on goods and services. That spending does much to stimulate the local economy.
Jebaraj said the biggest effect Walmart stock dividends have on Northwest Arkansas' economy comes through the Walton family's grants and donations to projects such as the Razorback Regional Greenway trail system, the Walton Arts Center, Theatre Squared and Crystal Bridges Museum of American Art.
"Wealthy people don't spend much money," he said, but instead are more likely to invest in their communities. "It's charitable giving more than anything else, and support for all these nice amenities that Northwest Arkansas has."
The 72207 ZIP code for Little Rock and Cammack Village was second behind Bentonville's 72712 ZIP code in 2016, according to IRS data, with tax returns reporting $47.9 million in ordinary dividend income, or about $21,800 per filing, compared with Bentonville's $446,000.
El Dorado's 71730 ZIP code -- home of Murphy Oil and Murphy USA, the refiner's spinoff retail company -- reported $28.4 million in ordinary dividends.
Tax-filers in the Hot Springs Village ZIP code of 71909 reported ordinary dividends of about $24 million. The resort community in Garland and Saline counties is home to about 14,000 people, many of them retirees.
A Section on 04/10/2019