401k or IRA ~ Tax on dividends to jump from 15% to 43.4%!

[Melensdad]

Hope you are not invested in "dividend" producing stocks for your retirement. Looks like you will really be taking it in the shorts if this goes through.

Remember, dividends are generally paid on after tax purchases of stocks and after tax payments by corporations, so if your IRA has 'high yield' stocks that pay out dividends you are going to be losing a lot of your income.

Oh, and this is one of those "tax the rich" things that Obama keeps touting. Did you know you were rich enough to get screwed

http://www.smartmoney.com/invest/st...ividends-to-increase-1332723167618/?mg=com-sm

. . .

Unless Congress takes action, the top tax rate for the highest earners on most dividends, currently 15%, is set to jump to a whopping 43.4% next year. That is a maximum income-tax rate of 39.6% -- since dividends will once again be taxed as regular income -- plus a 3.8% tax on investment income as part of the health-care overhaul passed in 2009.

Higher dividend taxes could take some luster off dividend-paying stocks -- and because the market is forward-looking, the fear is that their prices will fall sooner rather than later.

Dividend investors could protect themselves in the short term by placing options bets on a broad decline in dividend-paying shares, but that strategy is expensive. A better course for most is to seek a balance of income and growth stocks. In the income-stock portion, investors should favor those that promise to boost their dividend payments over those that merely have the largest "dividend yields," or payments as a percentage of their stock prices.

. . .​

 

[REDDOGTWO]

It makes no difference now, all withdrawals from a IRA are taxes as ordinary income. It does not make any difference from capital gains or dividends.

 

[tiredretired]

If you work for a living or did work and are now retired by investing wisely you are rich enough to get taxed like you are rich. In Obummers world the 51% who pay taxes are the rich ones who must pay for his followers. The ones who do not work. Half of this country think this is great deal.