31. roblem 2-5 Interest and Dividend Income (LO 2.2)

a. Respond to the following: In 2017, how are qualified dividends taxed?

Qualified dividends are taxed at ________(a. either 0 or 15%,b either 10 or 15%, c either 0 or 20%, d. either 10 or 20%, e. either 20 or 25%,f. either 0, 15, or 20%)

b. Complete the following paragraph that outlines the tax rates and application for qualifying dividends.

The ___________ (a. 0%,b. 10%, c. 20%, d. 25%) rate applies for taxpayers in the 10% and 15% income tax brackets and the __________ (a.0, b. 15%,c. 20%, d. 25% ) rate applies for taxpayers in the ordinary income tax brackets of 25% through 35%. The _________ (a.0, b. 15%,c. 20%, d. 25% )rate applies for taxpayers in the 39.6% bracket. An __________ (a.1.45%, b. 2.9%,c. 3.8%, d. 6.2% )rate Medicare tax on __________ (a.all income, b. net dividend income,c. net income, d.net investment income ) applies to high-income taxpayers with income over certain thresholds.