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Angelina received $20,000 of qualified dividends this year. Under what circumstances would all $20,000 of the...

Angelina received $20,000 of qualified dividends this year.

Under what circumstances would all $20,000 of the dividends be taxed at the same rate? Be specific in your answer.

Under what circumstances would the $20,000 of dividends NOT be taxed at the same rate? Be specific in your answer.

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Answer #1

Qualified Dividends would be taxed at the same rate being long-term capital gains. Here the rates are lower to the ordinary income tax rates. In the accounting year 2019, the tax rate on the long-term capital gains do not exceed 20%.

Dividends would not be taxed at the same rate when they are treated as Ordinary dividends which are taxed as an ordinary income, which varies as per investor’s income tax slabs and brackets. It is treated as ordinary income.

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