The combination of a possible hike in the federal tax ondividends and the boatloads of cash held by corporations is leadingto a proliferation in one-time special dividends being paid toinvestors, Businessweek reports.

Currently, individuals are taxed just 15% on dividend paymentsbut if tax cuts put in place under George W. Bush expire at thestart of next year, that rate could rise to more than 43%. So asyear-end approaches, companies are responding with special dividendpayments. The story notes that companies made similar payments inthe fourth quarter of 2010, when there were also concerns that theBush tax cuts might expire.

See the full story here. For previous coverage, see Tax Hike Could Discourage Dividend Revival.

Continue Reading for Free

Register and gain access to:

  • Thought leadership on regulatory changes, economic trends, corporate success stories, and tactical solutions for treasurers, CFOs, risk managers, controllers, and other finance professionals
  • Informative weekly newsletter featuring news, analysis, real-world cas studies, and other critical content
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the employee benefits and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.