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The
dividend tax rate reduction is scheduled to expire
on December 31, 2010, unless Congress takes action
to extend it. This means that the maximum tax rate
on qualified dividends could increase significantly
for some dividend investors.
The
bottom line: we need to take action now in order to
keep dividend taxes low.
Where
We Stand Today
In
an effort to preserve this important source of income,
the Obama Administration has proposed to maintain
the 15-percent tax rate on dividends for most middle-income
taxpayers (married taxpayers earning less than $250,000
per year; single taxpayers earning less than $200,000),
and the zero-percent tax rate for low-income taxpayers,
as part of its fiscal year 2010 budget proposal.
Separately,
Senate Finance Committee Chairman Max Baucus (D-MT)
introduced a bill on March 26, 2009, that includes
language to make permanent the reduced dividend tax
rates for taxpayers in the 10-, 15-, 25-, and 28-percent
tax brackets. For taxpayers in upper-income tax brackets,
the bill would increase and make permanent a 20-percent
tax rate on dividends, similar to the Obama budget
proposal.
Reduced
dividend tax rates put more money into your pocket
and encourage new investment in dividend-paying companies,
helping them raise the capital they need to fund major
infrastructure projects and compete in the marketplace.
What
You Can Do to Help
Tell Congress to protect dividends from high taxes.
Visit Defend
My Dividend to learn more about the benefits of
the dividend tax rate reduction, and sign up to join
the effort to keep dividend taxes low.
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