Calculate the after tax yields on the foregoing investments, assuming the Brittens have a 28% marginal tax rate (based on Public Law 108-27, The Jobs and Growth Relied Reconcilliation Act of 2003)

The condominium-expected annual increase in market value = 5%.

High Yield corporate stocks-expected dividend yield = 8%.

Savings account in a commercial bank -expected annual increase in market value = 10%; expected dividend yield = 0. PLEASE HELP, candy

A yield of 10% on a bank savings account (through accrued interest) is totally unrealistic, but the after-tax yield would be (1-0.28) x 10% = 7.2%, since the earnings would be treated as ordinary income.

Stock dividends would be taxed at 15%, assuming the Brittens were not subject to AMT, so the after-tax yield of the high-yield stocks would be 0.85 x 8% = 6.8%

The expected annual condo increase in value of 5% would be treated as long-term capital gains if they own the property long enough. That tax rate is 15% so the effective yield would be 0.85x5% = 4.25%, but there would be the additional benefits of not having to pay rent, less the disadvantages of having to pay for property tax, insurance and maintenance.

Thank you!

candy!

mjxqt yjcbm vfxauhd xcviyufq fspgb pketorvs rmxywdkv

Explain Bot Explain Bot answered
9 months ago

I'm sorry but I couldn't understand the phrase you provided. Could you please rephrase it or provide more context?