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Cash in lieu of fractional shares refers to the money that investors can get for the sale of fractional shares after a company restructures with a a merger, acquisition, stock split or creation of ...
If you use a Dividend Reinvestment Plan, or DRIP, to purchase additional shares or fractional shares of the stock, mutual fund or ETF, you’ll still be taxed on this investment income.
From 2003 to 2007, qualified dividends were taxed at 15% or 5% depending on the individual's ordinary income tax bracket, and from 2008 to 2012, the tax rate on qualified dividends was reduced to 0% for taxpayers in the 10% and 15% ordinary income tax brackets, and starting in 2013 the rates on qualified dividends are 0%, 15% and 20%. The 20% ...
Ordinary Dividends vs. Qualified Dividends: The Background Before 2003, all dividends were ordinary dividends and recipients paid taxes on them at their usual individual marginal rate.
Phantom stock is a contractual agreement between a corporation and recipients of phantom shares that bestow upon the grantee the right to a cash payment at a designated time or in association with a designated event in the future, which payment is to be in an amount tied to the market value of an equivalent number of shares of the corporation's stock. [1]
The investor doesn't get it in cash, only as a kind of IOU from the tax office, but nonetheless it and the cash portion make up pre-tax income. Thus a franked dividend of $0.70 plus $0.30 credit is exactly equivalent to an unfranked dividend of $1.00, or to bank interest of $1.00, or any other ordinary income of that amount. (It's exactly ...
For example, if an investor owns 100 shares of a stock that pays a cash dividend of $0.25 per share, the shareholder would receive an extra $25 from the company.
In any accounting period, a company may pay a form of corporate income tax on its taxable profit which reduces the amount of post-tax profit available for distribution by dividend to shareholders. In the absence of a participation exemption, or other form of tax relief, shareholders may pay tax on the amount of dividend income received.
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