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Are REIT Dividends Subject to the new 15 Percent Maximum Tax Rate?

April 26, 2017dividends maximum percent rate REIT Subject tax

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Are REIT Dividends Subject to the new 15 Percent Maximum Tax Rate?

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In May 2003, the U.S. Congress passed the Jobs and Growth Tax Relief Reconciliation Act, which cut income tax rates on most dividends and capital gains to a 15 percent maximum. Because REITs do not generally pay corporate taxes, the majority of REIT dividends continue to be taxed as ordinary income at the maximum new rate of 35 percent (down from 38.6 percent).