Please help with the following problem.
Consider three investors who need to partially liquidate investments to raise cash. In this case all investments have been held for 3 or more years. Investor A waited for a $1,500 qualified dividend distribution from her mutual fund, and investor B received $1,500 in interest income from a CD. However, because Investor C could not wait for a distribution, he decided to sell $1,500 of appreciated stock shares. Assuming no commissions, sales charges, or state income tax, and a 25-percent federal marginal tax bracket, which investment will provide the greatest after tax amount? Would your answer change if all investors were in the 15 percent tax bracket?© BrainMass Inc. brainmass.com June 3, 2020, 11:23 pm ad1c9bdddf
25% tax bracket
Qualified tax rate is 15% for the 25% income bracket
After tax = $1,500*(1-15%)=$1,275
Interest income is part of ordinary ...
The liquidation of three investments for greatest after tax amounts are determined. Step by step calculations are provided.