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Dividend tax calculator

A qualified dividend is taxed like a long-term gain: 0%, 15%, or 20%, stacked on the taxable income you already have. An ordinary dividend is just more ordinary income. The 1099 is where that label comes from. We don’t check it.

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Result

Federal tax on the dividend

$0.00

Qualified dividends use the 0%, 15%, and 20% bands. The extra 3.8% investment tax is not in this.

Here’s one

Single, $40,000 of other taxable income, a $5,000 qualified dividend

Filing single, $40,000 of other taxable income, and a $5,000 qualified dividend. The dividend stacks on top of that income inside the long-term bands. Call it ordinary instead and it gets taxed like wages.

How it works

Qualified dividends share the long-term gain bands. Ordinary dividends are added to your other income and taxed there.

Where this comes from

Qualified dividends use the same long-term bands as a gain you held more than a year. Ordinary dividends are taxed with the rest of your income. Topic 404 explains the difference. The 2026 dollar lines are in the revenue procedure.

Good for

You know whether the dividend is qualified. That word is on the 1099, not something to guess.

If you’re wondering

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