In fact, the same cash stream is often taxed any time it exchanges hands in many other instances. Former Unitholders of Plum Creek Timber Company, L. Canadian public companies may reduce your taxes payable. Income and Expenses, and Publication 564, Mutual Fund Distributions. Legislation proposed to extend the 15-percent tax rate on dividend income and capital gains. They are paid out of the earnings and profits of the corporation. Ordinary dividends are the most common type of distribution from a corporation. People who own stocks, bonds, or mutual funds, may receive dividends from those investments. Before making a major financial decision you should consult a qualified professional.

Ordinary and qualified dividends are reported on Form 1099-DIV. You should consult your tax adviser to determine what impact, if any, these allocations may have on your tax situation for the current tax year or in future years. The dividend tax credit is a non-refundable tax credit. Dividends are reported on Form 1040 Schedule B and Form 1040 lines 9a and 9b. Thereafter, the differential tax would be payable once the Finance Bill, 2007 is enacted.

Some or all of these ordinary dividends may be qualified dividends. If you have questions about your specific tax situation, please consult your tax adviser. Tax on distributed income in respect of money market mutual fund and liquid fund is proposed to be increased to 25 per cent plus surcharge and cess as applicable.