TY 2008 Tax Rates

[BOBOT]

Need some help from the tax mavens out there.I thought this info would be easy to find, but I didn't get definitive answers from a cursory google search.

What is the status of cap gains and dividends next year? I think I've heard that they are largely exempt from taxation next year only, at least for lower brackets.

And a related question - when figuring one's bracket for the purpose of determining cap gains taxes, does your bracket include the gains? IOW, if your earned income puts you in a lower bracket but including cap gains (and divs) puts you in a higher bracket, how will the cap gains tax if any be figured?

And if we do get a break on cap gains next year, do you think there will be a lot of selling pressure on the market as people rush to take advantage?

 

[MasterBlaster]

Here is a tax matrix that was posted on this site a few months ago.

 

[OAG]

Check out IRS Site. Instructions and Form 1040ES may provide the best easily found current information along with Publication 505.

 

[FIRE'd@51]

And a related question - when figuring one's bracket for the purpose of determining cap gains taxes, does your bracket include the gains?

Yes

if your earned income puts you in a lower bracket but including cap gains (and divs) puts you in a higher bracket, how will the cap gains tax if any be figured?

If your divs/cap gains put you into the 25% (or higher) bracket, that portion will be taxed at 15%. The portion that "fills up" the 10% and 15% bracket will be taxed at 0%

 

[CybrMike]

How do you figure out which bracket your in?

 

[NinjaPigeon]

How do you figure out which bracket your in?

It's based on AGI (Adjusted Gross Income). Basically income from all sources minus things like mortgage insurance or 401k contributions.

 

[FIRE'd@51]

Actually, it's based on your taxable income, which is your AGI minus your standard/itemized deduction and personal exemptions. The brackets for 2007 can be found here

2007 Federal Tax Rate Schedules