are dividends considered to be capital gain?

[imported_vr6]

Yes or No?

 

[KLin]

Yes. No. Maybe. I don't know 🙁

 

[spidey07]

I believe thanks to our savior Bush, no.

-edit- google friend....http://www.wwwebtax.com/income/dividends.htm

so it looks like the answer is "maybe"

 

[Zim Hosein]

No.

 

[imported_vr6]

heres the question my econ teacher asked.

Why would elimination of the tax on dividends will lead to faster long-run economic growth?

i was going to say..

decrease in capital gain tax = higher net earning for capital gain, which would encourage stock purchase = increase the value of stocks = easier for firm to raise money for investment in capital = long term growth.

 

[Zim Hosein]

Originally posted by: vr6
heres the question my econ teacher asked.

Why would elimination of the tax on dividends will lead to faster long-run economic growth?

I'm not doing your homework vr6! 😛

 

[imported_vr6]

Originally posted by: Zim Hosein

Originally posted by: vr6
heres the question my econ teacher asked.

Why would elimination of the tax on dividends will lead to faster long-run economic growth?

I'm not doing your homework vr6! 😛

check the post above yours, i just edited it with my answer.

 

[glenn1]

No. Dividends and capital gains are two seperate things. Dividends are taxed as normal income. Capital gains can be considered either short term (under 12 months, taxed at your marginal tax rate) or long term (taxed at a favorable capital gains rate). And to answer your question, they don't lead to faster long-run economic growth, since the total universe of investing dollars is technical finite, they simply lower the overall risk/reward profile and make it possible for risk-adverse investors to redeploy capital from high-risk/low yield/high-beta investments to commensurately now lower risk/low-beta/high yield securities and achieve the same risk-adjusted internal rate of return when all other factors are held constant. You're not creating new long-run economic growth, you're simply shifting it from one sector to another. That's probably not the answer your professor is looking for but it's the correct one.

 

[imported_vr6]

its econ 102, so thats probably too complicated of an answer for hiim...

 

[imported_vr6]

thanks to spidey07's link...

Effective January 1, 2003, dividends paid by most corporations are taxable as long-term capital gains. The new 15% and 5% capital gains rate applies to qualified dividends.

so i can probably use that as a argument for my answer..

 

[acemcmac]

not if you think that the spending of the middle class is the backbone of the american economy. Almost nobody from the middle class benefits from dividend taxes... hell... most companies don't even pay them.... the people it makes a difference for are so freaking wealthy anyway, its pointless.

Want to help the economy? Forget lowering corperate taxes anymore... that money rarley "trickles down," reganomics is 80% BS. Drop fuel taxes. I know it sounds awful, but who wouldn't benefit from gas suddenly costing 1.30$ again

<< econ minor... for whatever its worth :shrug;