Dividend policy refer to tax consideration

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Please give me an detail explanation of the below
Schwser Book 2 p222
“The cost basis of shares may receive a step-up valuation at the shareholder’s death. This means that taxes on capital gains may not have to be paid at all”
Is it same meaning with “taxes on dividneds are paid when the dividend is received, while capital gains taxes are paid only when shares are sold.”?
 
No.
It means that when you die, the basis on your stock may be increased to the price of the shares when you die, instead of the price of the shares when you purchased them.
Suppose that you purchased 5,000 shares of ABC, Inc. stock at $10/share 50 years ago. You die. (Sorry.) When you die, the share price is $150/share. The original basis was $50,000 (= 5,000 shares × $10/share). After your death, the basis is $750,000 (= 5,000 × $150/share). So, if your heirs sell your stock for $170/share, the (taxable) gain is only $100,000 (= ($170 − $150) × 5,000 shares) instead of $800,000 (= ($170 − $10) × 5,000 shares).
 
Do you mean that is about the case when people transfer their wealth to his/her successor?
 
Then I can understand what the sentence mean.
I appreciate to your reply.
 
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