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Pay Zero Tax on Qualified Dividends and LT Capital Gains

January 31, 2012

One of the advantages of a “self directed” retirement is that you have some flexibility in managing your tax burden. By self directed, I mean one in which your income is primarily derived from your investments rather than a pension. In a previous article I described a Zero Percent Withdrawal Retirement Plan. Someone following a similar approach can exercise some discretion when it comes to taxes by controlling the mix of income and the total amount. Your income may consist of wages, taxable interest, ordinary dividends, Schedule K-1 income and/or capital gains.

If you can live on an income that keeps your taxable income within the 15% bracket (or said differently, below the lower range for the 25% bracket) you will pay 0% tax on qualified dividends and 0% tax on long term capital gains.

Please see the entire article at Seeking Alpha.

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