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RE: A correction

Comment comment by wyldeling on 01 August 2007

As you said, a Schedule B (instructions) is filled out if your interest exceeds $1,500. However, it is merely an itemized list of all your interest (B - line(s) 1) and dividend (B - line(s) 5) sources, and you total interest (B - line 2) less your excludable interest (B - line 3) is entered in line 8a on the 1040. Line 8a is included in your total income (1040 - line 22), so it is taxed as normal income. In other words, it is not capped at 15%. The 15% cap applies to capital gains from the sale of a capital asset (most property is included, see the Schedule D instructions), and for those you need to fill out a Schedule D (instructions).

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RE: A correction by Brandon :: NR9

That makes sense.

For reference, here are the income tax rates for 2007, which are different from the capital gains tax rates.

Posted 01 August 2007, Hide, Parent, Reply