A dissenting opinion here. The 2017 TCJA (tax cut & job act) allows REIT shareholders to deduct 20% of their REIT dividends, even if you take the standard deduction
. This is from T Rowe Price:
2019 Qualified REIT Dividends
Beginning in 2018 (until the end of 2025), if you are a taxpayer other than a corporation, you are generally allowed a deduction of up to 20% of your qualified real estate investment trust (REIT) dividends. Qualified REIT dividends from a mutual fund are reported in Box 5 of your Form 1099‑DIV.
If the holding is in an investment account you're going to get a 20% tax savings. I use Turbotax and download tax info from Fidelity. The deduction was automatically calculated and included in my filing.
If the holding is in a Traditional IRA the savings are lost because 100% of distributions from a Trad. IRA are taxed at regular income levels.
If the holding is in a Roth IRA it's a moot point since all earnings and qualified distributions from a Roth are tax-free.
This deduction is phased out for higher income individuals and couples.
While it's not as great a savings as the 0% tax on qualified dividends that many moderate income earners can get, it does make REITs more desirable (less undesirable?) in after-tax investment accounts.