Dividend Payouts

The attached article serves as a reminder of the work being done by the Bush Administration to stimulate the economy through tax cuts. Mark Battersby writing in Investment News reports that companies in the Standard & Poor's 500 stock index are expected to pay out a record $186 billion in dividends to shareholders in 2004. The record dividend payments result from the lowering of the minimum tax on qualified dividends to 15% last year combined with healthier profit margins for the companies in question and an improving economic climate.

In the past, dividend income was treated as just another type of ordinary income, taxed at the individual taxpayer's normal tax rate, whichßcould be as much as 35% for federal income tax alone. Beginning in 2003, the maximum federal tax rate on qualifying dividends dropped to a maximum of 15% and a minimum of only 5%.ß In order to qualify for the new lower taxes on dividends, the stockholder must hold the stock on which the dividends are paid for more than 60 days during the 120-day period that begins 60 days before the last date on which a shareholder of record is entitled to receive the upcoming dividend.ß The bottom line is that all investorsßnow pay lower tax rates on dividendsßreceived from domestic corporations and qualified foreign corporations under the provisions of the Jobs and Growth Tax Relief Reconciliation Act of 2003.ß

Battersby adds that the U.S. Treasury Depar

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over the past year, and household wealth is at an all-time high. However, he warned against the "unwelcome'' rise in oil prices, which is negating the effect of tax cuts. High oil prices "act like a tax on average Americans,'' Mr. Snow said. IRS clarifies tax rules for agent, publisher The tax rules are quite clear: If you are in business, all payments to a service provider must be reported on Form 1099. The Internal Revenue Service recently described the correct reporting procedure in a situation where a publisher pays royalties to an author's literary agent, and the agent pays the author. In this case, the IRS expects the publisher to report on Form 1099 the full amount of the payment to the literary agent. The agent must provide the author with a Form 1099 and also report the full amount of the payment from the publisher, even if the literary agent has subtracted a commission before making payments to the author. Cite: Revenue Ruling 2004-46 Are charitable funds diverted to terrorists? Officials from the IRS, the Department of the Treasury, an attorney for a tax-exempt charity and a Muslim professor debated IRS policies on the charitable funding of terrorist organizations at a recent Law and Faith Conference in W
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Some common words found in the essay are:
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Approximate Word count = 1808
Approximate Pages = 7 (250 words per page)

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