Tax Increase Prevention and Reconciliation Act of 2005 - Cap gains

[KJ Judd]

Per the Tax Book update:

New law, Section 102 of the Tax Increase Prevention and Reconciliation Act of 2005: The 15%, 5% and 0% tax rates for long term capital gains and qualified dividends is extended 2 years through December 31, 2010. The rates do not revert to pre-5/6/2003 levels until the 2011 tax year.

So what is the capital gains rate in 2008-2010 for 15% bracket individuals? Originally it was supposed to be 0 in 2008. I'm unclear if the rate is extended at 5% or 0% for these individuals.

[Unregistered]

rates

TIPRA extends these reduced rates through 2010. For taxpayers in the 10% and 15% tax brackets, the 0% rate will be in effect for tax years 2008-2010

[jimmcg]

Tipra

This zero percent long term capital gains rate for lower tax bracket taxpayers should precipitate some astute tax planning for these years by professionals for those who have a lot of unrealized capital gains.

[KJ Judd]

Thanks! I agree on the tax planning opportunity, especially when you have three years to stretch it over.