timber, Where did you get this info? " BTW ... over 50% of Americans 55 and older receive at least some dividend income." Only a small number of companies actually pay dividends. How can the majority of Americans 55 and older be receiving dividends even if they own stocks? c.i.
Bill, I guess this is one where you and I are just going to disagree.
I see The Dems as trying to use the "Class Warfare" angle to cloud the issue, and I see their proposal as palliative rather than amelleiorative. The Republican approach encourages Business Growth, while The Dems offer little more than a quick boost over the current rough spot. I don't see that they offer an alternative to The Republican Measure, but rather that they seek to obstruct it.
An old saying comes to mind: "A Democrat is one who is firmly committed to imposing his idea of "Good" on other folks with their own money".
timber
Dividend Income:
This is presented to the stock holder as either cash ( check) or as more stocks.
I personally take the stocks and not the $.
One more point: The administration's stimulus package will not work. It looks at the long term benefit by benefiting people that receive dividend income. As timber claims, it may benefit fifty percent of people over 50 years old. We need something more short term that benefits all Americans, and immediate for the long term. In that respect, the democrat's plan is a better one. Money has to be put into consumers hands now. It can't wait until some dividend income is declared for some people that receive dividend, and hope that will translate into a boon to our economy. Very short sighted, indeed! c.i.
c.i., the statistic includes folks who derive income from Funds, which would include most pension plans, BTW, as well as direct holders of equities. The payout from funds is in part comprised of Dividend Return. I don't have a link at hand, but the figure comes from an article I read some time ago, I believe in an AARP publication. I've heard the figure mentioned in a few speeches recently too, and have seen no refutation of it. The broad demographic data one way or the other is matter of public record, likely available both from IRS and Census Bureau Public Documents.
timber
I'm in favor of Bush's proposal. I own stock and I'm tired of paying tax on the dividends.
I'm not among the very rich, however.
Less tax means an incentive to spend more money, which is a potential stimulus to the economy.
timber:
The dividends derived from stocks in pension plans are not subject to taxation. The $ in a pension plan is not taxed until, the retiree starts to draw his pension. Then the tax is on the amount withdrawn and not on the stocks ( or funds ) held in the retirement plan.
New Haven, Thanks for the clarification. You are absolutely correct! How will the IRS determine what amount of retirement withdrawal of a 401k or IRA is dividend income? That'll be fun to watch!
c.ii.
Washington- Americans believe by 2 to 1 that it's prudent to hold off on more tax cuts, a centerpiece of President Bush's domestic policy agenda, an Associated Press poll suggests.
Then, they must not like the Dems proposal, which copies Bush's tax cuts.
LASH:
If this is true, then those Americans who don't want a tax break shouldn't take one....Those who want a tax break ( ME :wink: ) will take it.
cicerone imposter wrote:New Haven, Thanks for the clarification. You are absolutely correct! How will the IRS determine what amount of retirement withdrawal of a 401k or IRA is dividend income? That'll be fun to watch!
c.ii.
Why would it be done any differently than it is right now? As things sit today you have to calculate your basis and dividends when you withdraw money from your IRA so that you can calculate how much you owe in income taxes.
New Haven, you're right, of course, but the operative word is 'receiving", I believe. When the retiree begins receiving ... withdrawing ... retirement income, it is taxed.
Again, I don't think The Republican Plan offers the perfect solution. I doubt there can be a perfect solution. I see only "Aid", not "Solution", in any of The Democrat's proposal.
timber
BillW wrote:fishin' says:
Quote:The Democrats plan is a $300/$600 rebate (which they ridiculed endlessly when Bush did that previously..)
This was originally a Democrat idea that was taken over by Bush. This is more recreation history!
So how does that disprove the fact that the Democrats poo-poo'd the rebates last time?
fishin, The total withdrawal is taxable. We don't calculate anything, because it's all taxable. The 401K and IRA were all pretax income purchases. All the appreciation or depreciation is taxed when withdrawn from the 401K or IRA. c.i.
Just another thought ... The "Tax Cuts" apply to Federal Income Tax. Grab one of your pay stubs if you have one handy. The breakdown of Taxes Withheld will show that Federal Income Tax is but a bite out of the cookie. The average wage earner pays much more in other taxes than in Federal Income Tax
timber
cicerone imposter wrote: We need something more short term that benefits all Americans, and immediate for the long term. In that respect, the democrat's plan is a better one. Money has to be put into consumers hands now. It can't wait until some dividend income is declared for some people that receive dividend, and hope that will translate into a boon to our economy.
You seem to have some inconsistancies in your posts in this thread c.i. Last night you posted:
Quote:Giving money to another branch of government is the worst way to stimulate our economy. We all need an immediate tax cut of ten percent off the top for everybody to stimulate our economy. No peacemeal tax rebate of $300/$600 is going to do anything for a ten trillion dollar economy.
Would you please clarify these? The two staments are in direct conflict with each other.
Outside of drawing off of a diminishing savings, how else can retirees survive? A low risk investment.
As state employees, we chose a stock package based on our preferred risk factor. Twice a year, I recieved a printout of the dividends my stocks accumilated. Trust me, we weren't wealthy.
Dividend tax breaks are obviously not limited to the wealthy. Pretty soon, the country will have to make the shift away from Medicaid to stocks for the majority, then ALL, of our retirement needs.
Then, we will need this tax break. Might as well get it now, to make stock investments more appealing.
Lash:
The best, when in doubt is to use "Fixed Income" investments as much as possible, when retired.
cicerone imposter wrote:fishin, The total withdrawal is taxable. We don't calculate anything, because it's all taxable. The 401K and IRA were all pretax income purchases. All the appreciation or depreciation is taxed when withdrawn from the 401K or IRA.
Ah! Well, the system is already there none the less. I had to do the calculations in past years when I took early withdrawls from my IRA. You haven't hit it because all your contributions were pretax. The calculations are explained in the instructiosn for an IRS Form 8608 amongst others.
New Haven--
Thanks for the tip. I am a very conservative investor, for retirement purposes only.
Have I said you are a fresh breath of sensible, friendly air?
Glad to meet you.
