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Author: WazooDA Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75335  
Subject: Taxes and Early Retirement Date: 7/25/1998 11:42 AM
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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.

WazooDA
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