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No. of Recommendations: 2
"As a retiree and under the current tax federal tax law, I pay 0% federal tax on my first $40-45k in long-term capital gains and qualified dividends."

This is an outstanding tax place to be; however the 0% federal tax rate isn't on your first $40-45k in long-term capital gains but the zero rate is only in effect if your total taxable income is less than $80,801 if married or $40,401 if single. The trap is if your income exceeds these amounts by just $1 you fall off a cliff for ALL of your 0% tax capital gains & qualified dividends; the capital gains/qualified dividends tax reverts to 15%. In other words its not just the excess but the ENTIRE capital gains/qualified dividend becomes taxable @15%.
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