Does the one-year holding period affect whether my dividends are taxed favorably?

Yes, but the holding period for qualified dividends is shorter and trickier than the one-year rule for long-term capital gains. To have a dividend taxed at the lower qualified rate, you must hold the stock for more than 60 days during the 121-day period that begins 60 days before the ex-dividend date. If you buy a stock, collect the dividend, and sell too quickly, that dividend gets bumped to your ordinary income rate even though it would otherwise have qualified. This rule exists to stop people from "dividend stripping" – grabbing a dividend without real ownership risk. For buy-and-hold investors in index funds it's a non-issue; you easily clear 60 days. It mainly trips up active traders who churn dividend-paying positions around payout dates.