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Alicia received dividends on her stocks as follows. Qualified Dividends Steinlager (a New Zealand corp. whose stock is traded on an established US securities market)
Alicia received dividends on her stocks as follows. Qualified Dividends —Steinlager (a New Zealand corp. whose stock is traded on an established US securities market) $45,000 —Star Inc, a Virginia Corp 11,000 Non-Qualifying Dividends —Blaze Inc, a Delaware Corp 23,000 Alicia (single) purchased the Star stock four years ago, and she purchased the Steinlager stock two years ago. She purchased the Blaze stock 15 days before it went ex-dividend and sold it 20 days later at a $28,000 loss. Alicia had no other capital gains and losses for the year. She is in the 32% marginal tax bracket. Compute Alicia’s tax on her dividend income. Also, will she be able to deduct the entire capital loss from the Blaze stock? Alicia’s daughter (single), who is not her dependent, had taxable income of $18,000, which included $3,000 of dividends on separate shares of Star, Inc stock. The daughter had purchased the stock two years ago. Compute the daughter’s tax liability on the dividends.
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