All of the income in the lower bracket still gets taxed at the lower bracket rate - including LTCG and dividend income at no tax.Well, no. The LTCG and dividends are included in the taxable income, but the rate for them depends on your tax bracket.http://www.bogleheads.org/wiki/Qualified_dividendhttp://www.1040.com/federal-taxes/income/dividends/http://en.wikipedia.org/wiki/Qualified_dividendFor most people it doesn't matter, because most non-retired people with investments are well above the top of the 15% bracket.Turbo tax was quite clear on this. I well know because I had to do some fancy footwork to stay in the 15% bracket the last 2 years.Play with it in TurboTax (for 2012). Enter $10,000 of dividends and other income to get taxable income of $70,699 (married-joint). Then add $2 more income to bump the T.I to $70,701. The tax jumps a whole lot, because the entire $10K of dividends is now taxed.
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |
BATS data provided in real-time. NYSE, NASDAQ and NYSEMKT data delayed 15 minutes.
Real-Time prices provided by BATS. M