No. of Recommendations: 0
Assuming all goes well, my wife and I have a chance of retiring (at least not needing to work) at around 40. Currently, we are in the 39.6% tax bracket.

If, at 40, we both stopped working and thus dropped into the lowest bracket, would dividends coming in from our Foolish Four portfolio be then taxed at the lowest rate?

Further, even though our portfolio would be in the $3 mil range, would we still get the benefit of a 20% capital gains tax assuming we held for a year and a day?

I guess it all just seems odd to me that if we get lucky and become rich.... our taxes would actually decrease substantially versus us both working like dogs now!

Anyway... thanks for helping a newbie on these issues.

Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.