Qualified Dividends: Qualified dividends are the ordinary dividends subject to the same 0%, 15%, or 20% maximum tax rate that applies to net capital gain. They should be shown in box 1b of the Form 1099-DIV you receive.
The maximum rate of tax on qualified dividends is the following.
• 0% on any amount that otherwise would be taxed at a 10% or 15% rate.
• 15% on any amount that otherwise would be taxed at rates greater than 15% but less than 39.6%.
• 20% on any amount that otherwise would be taxed at a 39.6% rate.
To qualify for the maximum rate, all of the following requirements must be met.
• The dividends must have been paid by a U.S. corporation or a qualified foreign corporation. (See Qualified foreign corporation, later.)
• The dividends aren't of the type listed later under Dividends that aren't qualified dividends, later.
• You meet the holding period (discussed next).
The joke is that we're not kidding. The above appears on the IRS' website today. Call it the Helpful Hints section. All 292 pages of the one publication we looked at, Publication 17, "Your Federal Income Tax" for individuals. And there are other parts, supplemental guides, circulars for farmers, data books, notices . . . . We stopped caring at Form 211.
When will this end? Even when the federal government cuts taxes, as it did this year, the Infernal Tax Code remains as cluttered as ever. Why can't this country come up with a better idea? MAGA? How about starting with helping the citizenry understand how it's taxed? April is the the saddest month, mixing--not memory and desire, as the poet said--but injustice and sheer mind-numbing complexity. The injustice most of us can understand at once, and in a bitter flash. The complexity seems to get worse every year.
Once again the almost mystical Internal Revenue Code, with its acres of nooks and crannies for the specially favored, has managed to cost the government a lot of internal revenue. The IRS reports that 63 percent of all tax returns were done by professionals in 2013.
Maybe because only a pro could figure out what th' heck the IRS is talking about. Or, even better, have the software and computers (updated every tax season) so Hal can figure it out. Not that it's likely that even he could get it 100 percent right either. For the stories keep coming of people calling the IRS, asking the same question of the people who work there, and getting different answers from different people. And then we are supposed to swear--on penalty of perjury--that what we're turning in to the government is correct? How many years does perjury carry in Arkansas?
Most of us don't object to paying our taxes. Living in the United States of America is not only a privilege but a great bargain. What we object to, or should, is how hard, how complicated, how expensive and sometimes just plain hopeless it is to figure out how much tax we owe. Awash in a sea of paper, or maybe in an ocean of electronic impulses in this Internetted age, the American taxpayer needs . . . help!
This whole involved system collects trillions of dollars, but at the cost of billions. A vast industry of tax collectors, tax accountants, tax planners, tax lawyers and tax lobbyists has grown up to deal with all the loopholes, rules, trap doors and lawyerspeak hidden in the sprawling Internal Revenue Code. And the blamed thing keeps expanding with every "tax break."
For the average American family, filling out a tax form has become like attacking a puzzle to which, often enough, there is no right answer. This country's tax code has grown as indecipherable to the average American as Hammurabi's. It might as well be written on clay tablets.
There ought to be something better to do every April 15 (or April 17th this year) than just fling our return at Uncle Sam and complain about it. We've written this editorial before--it seems like every year--and nothing changes except the date on the check. It's time to stop complaining and do something.
Don't mend it, end it. Abolish the tax code and start all over. After all, would anybody starting from scratch come up with a system as indecipherable and counter-productive as the one we've got? So why not opt for a clean break with the past? This country started with a tax revolt. It's tradition! So let's do it again. Take the tax code out behind the (depreciating) barn and kill it with an ax. Then tell Congress to come up with a better plan by, oh, Dec. 31. Nothing might concentrate our betters' minds like a tax code coming to an end.
And next April 15, we can sleep better o' night.
The IRS can't accept a single check (including a cashier's check) for amounts of $100,000,000 ($100 million) or more. If you are sending $100 million or more by check, you'll need to spread the payment over 2 or more checks with each check made out for an amount less than $100 million. This limit does not apply to other methods of payment (such as electronic payments). Please consider a method of payment other than check if the amount of the payment is over $100 million.--IRS.gov
We had no real point in mind when we decided to include the above paragraph, also taken from the government's official tax website. We just decided to reprint it here, in case it comes in handy for Gentle Reader as he gets his business in order. Good luck, all.
Editorial on 04/15/2018