Qualifying for the 0% Tax Rate for LTCG and Dividend Rate

ARTICLE | July 10, 2024

Authored by Vasquez + Company

Discover how you might qualify for a 0% federal income tax rate on net long-term capital gains (LTCGs) and qualified dividends, even if your income seems too high. This article breaks down the 2024 tax brackets and explains how individuals and couples can leverage this favorable rate. Learn strategies to set up loved ones for tax-efficient benefits and understand the implications for federal gift and estate taxes.

Federal Tax Brackets for LTCGs and Dividends

Your federal income tax bracket for net LTCGs and qualified dividends is determined by your taxable income, including any capital gains and dividends. Taxable income equals your adjusted gross income minus either:

  • Your standard deduction, if you don't itemize, or
  • Your total itemized deductions, if you itemize.

Here are the 2024 federal rate brackets for net LTCGs and qualified dividends, based on taxable income:

LTCG Tax Rate Single Married filing jointly Head of household
0% $0–$47,025 $0–$94,050 $0–$63,000
15% $47,026–$518,900 $94,051–$583,750 $63,001–$583,750
20% $518,901 and up $583,751 and up $583,751 and up

For more information, read the full article here.