Sentences with phrase «investors in a high income tax bracket»

Since the maximum tax on capital gains was reduced to 15 % in 2003, total return investors in a high income tax bracket may find advantages to holding their bonds in a taxable account.

Not exact matches

Investing in municipal bonds can be a great way for investors in high tax brackets to generate federally tax - free interest income.

If a person has additional money to set aside for retirement, an annuity's tax - free growth can be beneficial, especially if the investor is in a high - income tax bracket.

Here's a simple example for an Ontario investor in the highest tax bracket, where capital gains are taxed at 23.20 %, Canadian dividends at 29.52 %, and foreign income at 46.41 %:

However, for investors in the 28 % or 33 % brackets, especially those with large capital gains that may result in the reduction or elimination of the exemption amount and those who live in states with high income taxes, the AMT may become a problem.

Factor in the 3.8 % tax on investment income under the Affordable Care Act and the yield for an investor in the highest tax bracket becomes 3.25 %.

This means that dividend income will be taxed at a lower rate than the same amount of interest income (investors in the highest tax bracket pay tax of around 25 % on dividends, compared to 50 % on interest income).

It would aslo be more beneficial to investors on higher incomes in higher tax brackets.

Investors in a high tax bracket might want to consider Municipal Bond ETFs because they can provide tax - exempt income and a steady income stream.

If an investor is in the highest tax bracket, they face a tax liability of ~ 1 % of capital invested with fixed income in a taxable account (50 % of 2 %), and ~ 2 % with capital gains / dividends (25 % of 8 %).

Therefore, higher - income investors (with theoretically higher tax bills) are likely to benefit more from municipal bond yields than individuals in lower tax brackets.

Investing in municipal bonds may help investors in high tax brackets generate federally tax - free interest income.

Investors in the higher income brackets may benefit from tax - exempt money market funds which invest in bonds and securities issued by municipalities and state governments.

(Investors in the highest tax bracket pay tax of around 29 % on dividends, compared to 50 % on interest income.

Investors in the highest tax bracket pay tax of around 29 % on dividends, compared to 50 % on interest income.

This creates the following possibility for investors in high - income tax brackets: If you buy Fund A at age 64 in a taxable account and sell it two years later for a $ 4,000 gain, you'll pay a capital - gains tax of up to $ 800 (20 %).