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To: cyesp who wrote (109287)9/14/2008 12:49:06 AM
From: Fastball  Read Replies (2) | Respond to of 206223
 
CYESP - RE pfd dividend tax treatment --
Many of the utility pfds are "traditional" preferred stock as opposed to "trust pfd" or debt instruments issued as preferred stock. The traditional pfds are still eligible for the 15% tax because they are true dividends, i.e. they come out of actual earnings.

The best way to check is to go to QuantumOnline.com. (In my opinion, one of the most useful, free sites on the web.) Plug in the symbol for a utility, then click "Find All Related Securities." When you click a particular pfd issue, it will tell you whether it gets the 15% tax treatment.



To: cyesp who wrote (109287)9/14/2008 12:28:12 PM
From: kollmhn  Read Replies (1) | Respond to of 206223
 
cyesp-

There are two kinds of dividends; qualified and unqualified.

Those that are truly dividends, rather than interest income in disguise, are QUALIFIED. They get the 15% treatment. The unqualified are taxed at ordinary income rates.

I can't tell you what percentage of all divvies fall into which category but suffice it to say there are MANY billions that are qualified.