The Motley Fool Discussion Boards

Previous Page

Financial Planning / Tax Strategies


Subject:  Re: Dividend Taxes Date:  3/3/2013  6:37 PM
Author:  JAFO31 Number:  117953 of 127747

JLC: "Our our taxable brokerage accounts would generate about $100k in dividends. We wouldn't have any other income. My head is spinning about qualified dividends, as I understand it, its similar to long term capital gains, long held stock dividend taxed at lower rate? If all was qualified dividends and we had no ordinary income, could our tax rate really be zero?"

I am no tax pro, but I deem it unlikley.

"Which tax rate the dividends qualify for depends on what the regular tax rate on the dividends would be. This is determined by your tax rate on earned income.

•Dividends qualify for the 0% rate (tax-free) if you fall within the 10% or 15% tax brackets.
•Dividends qualify for the 15% rate if you fall within a higher tax bracket.

There are exceptions, so see IRS Publication 550 for more information."

For 2013, MFJ 15bracket tops out around 72.5k. See:

Also, you would need to review AMT to determine whether you owed more income tax under the AMT world.

See, e.g.,

I hope that one of the resident tax pros will eiher confirm or correct.

Regards, JAFO
Copyright 1996-2018 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us