The Zero Percent Tax Rate on Capital Gains

Under present law, 2010 is the final year in which capital gains and qualified dividends will not be subject to tax in the hands of certain individual taxpayers – those in the two lowest tax brackets. This zero percent rate became available beginning in 2008 and raises significant planning questions and opportunities for lower-income taxpayers, and other taxpayers that can utilize tax management strategies to minimize income to take advantage of the zero percent rate.