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Dividend Tax Rules
can be a confusing subject to the average person or even to the most talented of accountants. Knowing the
is the best way to keep your
up-to-date and making the payment of taxes practical and efficient. Dividend taxes can involve large amounts of money and create many questions. Below are the most commonly asked questions about dividend tax rules that have been answered by the Experts.
If a person purchases a stock and only holds it for a few days until they sold it, would that person qualify for the 15% dividend tax rate?
In many cases an individual must own the shares for at least 61 days in order to qualify for the 15% dividend tax rate since the date of purchase does not count.
If I reside in England but all of my earnings are from an A company based in America. I made approximately $150,000 what tax percentage will I be liable for?
The single filer tax rate for a United States citizen in that tax bracket based on your income in most cases would be 28%. .
I am a non-resident alien in the U.S. and a citizen of the U.K. my work requires me to be a U.S. taxpayer. Are there any double taxation problems that could surface in this matter?
Since there is a tax treaty between both countries, in most cases you should not be double taxed. And generally any taxes paid to the U.S. would be credited back to you on your U.K. tax return.
On an income of $50,000 what is the tax percent for short term dividend tax, long term dividend tax, and qualified dividend tax?
are taxed at the
’s ordinary tax rate, which would depend on the taxpayer’s total
. Long term dividends (which are held for more than a year) are taxed at 15%. Qualified dividends are subject to the outcome of
Internal Revenue Service
worksheet 8949 page D- 10
Instructions for Schedule D
, and Internal Revenue Service Form 1040 page 37.
Instructions for Form 1040
A corporation’s taxable income is $1,500,000. If it distributes its after-tax income to its shareholders whose dividend rate is 15%, what is the total tax and the combined effective tax rate for this income?
In most cases the taxes at the corporate level would be roughly $510,000, leaving approximately $990,000 available to distribute. The tax on dividend at the shareholder level would be approximately $148,000. The total taxes would be approximately $658,000. This is approx 43.9% of income taxed.
Dividend tax rules can provide the answers to many questions - and sometimes it can create more questions and problems to solve. Keeping up with current dividend
and rules can be essential whether it is for a company or an individual. The well informed person would do well by using every available tax resource to its full potential In order to ease the financial strain of taxes, and the many questions that they bring. Those who have questions regarding dividend tax rules should consult an Expert.
Recent Dividend Tax Questions
I asked a question and got an answer .I followed up with a
i asked a question and got an answer .I followed up with a request for clarification. Somehow i managed to ask something about K1? It was the clarification I wanted, but I have had no response , or I just don't understand how your system works. help please
Fred let me repeat request for clarificaton I have an estate worth 1,000,000 cost basis 500,000 [total is within exempyion so no estate tax]. I was told the beneficiary paid no cap gain, got a cost basis of 1,000,000, then paid dividend tax and cap gain on
future development of estate I wanted clarification on these points 1. assume executor liquidates assets and pays beneficiary in cash. Does estate owe cap gain before distribution? 2.Does liquidating the estate on death make any difference to tax to either
the estate or the beneficiary? 3. Is their any form of tax on such estate . fred
I am moving from a LLC to a C this year and have a couple of
I am moving from a LLC to a C this year and have a couple of questions;
Best way to avoid double taxation on my salary; i.e. dividends, distributions, etc. ( I will be the sole shareholder for the next few years.
My wife will work as a subcontractor for the company also, so does it make sense to pay here more and pay myself a very small salary?
I am not talking about very big numbers the first year, so it may be of little consequence. I can also direct my clients to pay me as an individual also until we grow larger.
All of this while I need to build some good financial statements for the company in order to move to phase 2 of the business.
2 Questions on dividend tax witholding and ETFs US withholding
2 Questions on dividend tax witholding and ETFs
US withholding taxes on dividends would only apply to US domicilied stocks and ETFs. If i have a US based ETF I would pay 30% withholding tax on dividends (in my case given W8 filled and UK resident it would be 15% witholding tax). If its a non US stock or ETF i would not have to pay any US witholding tax
Question is: if i buy into US domicilied ETFs from my US broker and they withold automatically the 15% dividend tax, is there anyway of claiming back the US dividend tax withheld from the US?
2- Understand that interest income should not be subject to US witholding taxes. If i invest in an US ETF that only has bonds and only receives interest income, am I subject to the US witholding tax when the ETF pays out its interest as a dividend (given ETF are like stocks and pay dividends) or are they exempted from it given they only pay the interest as dividend?
I am a non US citizen and non US resident (actual resident in the UK - but a non domicilied which should mean I pay no income or capital gains for money abroad).
I have a US brokerage account withwhom I do my investments. I have a W8 form that has been filled.
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