Definition
Qualified dividends are taxed at long-term capital gains rates (0%, 15%, or 20%) rather than higher ordinary income rates. To qualify, dividends must come from U.S. corporations or qualified foreign corporations, and you must hold the stock for more than 60 days during the 121-day period around the ex-dividend date.
Example
A $10,000 qualified dividend for someone in the 22% tax bracket is taxed at 15% ($1,500) instead of 22% ($2,200).
FAQ
What is Qualified Dividend?
A dividend taxed at lower capital gains rates rather than ordinary income rates.
Why is Qualified Dividend important?
Qualified Dividend helps investors evaluate taxes and make more informed decisions.