| Author |
Message |
Steve Pope
Guest
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 Posted:
Thu Oct 20, 2005 8:00 am Post subject:
15% dividend tax rate? |
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What exactly would it mean if a security is marketed as
receving "15% dividend tax rate" treatment?
Does this increase its value to individual investors?
Thanks
Steve
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Phil Marti
Guest
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| Posted:
Thu Oct 20, 2005 9:07 pm Post subject:
Re: 15% dividend tax rate? |
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"Steve Pope" <spope33@speedymail.org> wrote:
| Quote: | What exactly would it mean if a security is marketed as
receving "15% dividend tax rate" treatment?
|
I assume it means that the dividends would be "qualified"
and receive the benefit of the reduced income tax rate. To
be sure what it means, ask the marketer.
| Quote: | Does this increase its value to individual investors?
|
All sorts of things influence investors. If my assumption
is correct, this stock isn't different from most others, and
I'd be looking at performance and financial aspects of the
company rather than tax treatment of its dividends.
--
Phil Marti
Clarksburg, MD
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
<< The Charter and the Guidelines for submitting >>
<< messages to this newsgroup are at www.asktax.org. >>
<< Copyright (2005) - All rights reserved. >>
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Rich Carreiro
Guest
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| Posted:
Thu Oct 20, 2005 9:07 pm Post subject:
Re: 15% dividend tax rate? |
|
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spope33@speedymail.org (Steve Pope) writes:
| Quote: | What exactly would it mean if a security is marketed as
receving "15% dividend tax rate" treatment?
|
It means that dividends from that security are
so-called "qualified dividends" and thus bear
a federal income tax rate of no more than 15%.
| Quote: | Does this increase its value to individual investors?
|
Relative to what? Bonds? Probably. Other stocks?
Probably not, since almost all corporate dividends
qualify for 15% treatment.
--
Rich Carreiro rlcarr@animato.arlington.ma.us
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
<< The Charter and the Guidelines for submitting >>
<< messages to this newsgroup are at www.asktax.org. >>
<< Copyright (2005) - All rights reserved. >>
<< ======================================================= >>
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Bill
Guest
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| Posted:
Thu Oct 20, 2005 9:07 pm Post subject:
Re: 15% dividend tax rate? |
|
|
spope33@speedymail.org (Steve=A0Pope) asked:
| Quote: | What exactly would it mean if a security is
marketed as receving "15% dividend tax rate"
treatment?
Does this increase its value to individual
investors?
|
"Qualified" Dividends are taxed at a special 15% rate (5%
for low income TPs). That must be what they are referring
to.
Obviously, the value to investors is a lower rate of taxes
due. The calculation comes either on a worksheet found in
your instruction booklet, or on page two of Schedule D.
The key entry is a subset of Dividend Income -- Line 9b on
2004 Form 1040. Computer programs will pick that up and
spit out either the worksheet or Schedule D, with the proper
calculations.
Bill
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
<< The Charter and the Guidelines for submitting >>
<< messages to this newsgroup are at www.asktax.org. >>
<< Copyright (2005) - All rights reserved. >>
<< ======================================================= >> |
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