— Tax, VAT & Sales
Dividend Tax Calculator
Estimate tax on qualified or ordinary dividends. Qualified dividends use long-term capital-gains rates; ordinary dividends use regular income-tax rates. Enter dividends and income to see tax, after-tax income, and how much qualified treatment saves.
Dividend tax
$750
- After-tax dividends
- $4,250
- Effective rate on dividends
- 15%
- If non-qualified (ordinary)
- $1,100
- Rate applied
- Qualified — 15% tier
— How it works
Qualified dividends stack on your other income and are taxed at the 0/15/20% long-term rates. Non-qualified dividends are taxed as ordinary income — at the marginal brackets they add to.
Qualified vs ordinary — the rate that doubles
Whether a dividend is “qualified” can roughly halve the tax on it. Qualified dividends — most dividends from US corporations and many foreign ones, provided you held the stock long enough — are taxed at the long-term capital-gains rates of 0%, 15% or 20%, set by your income. Ordinary (non-qualified) dividends — from REITs, money-market funds, employee stock, and stock you held only briefly — are taxed at your ordinary income rate, which for a middle earner is 22–24%. Same cash in your account, very different tax, which is why the qualified status matters. The calculator shows both so the gap is explicit.
Worked example — $5,000 of dividends, $60,000 other income, single, 2025: Qualified: taxed at the 15% tier = $750. Ordinary: taxed at your 22% rate = $1,100 — $350 more for the same $5,000.
How the tier is set
Like long-term gains, qualified dividends stack on top of your other taxable income to decide which preferential tier applies. A single filer in 2025 pays 0% on qualified dividends while total income stays under about $48,350, 15% up to roughly $533,400, and 20% above — so a low-income year can mean zero tax on dividends. If you have both kinds, split them: the non-qualified portion is taxed first at ordinary rates, then the qualified portion stacks above it at the preferential rate. The “other taxable income” field is what positions everything, so it matters as much as the dividend figure itself.
State tax and foreign withholding
States generally do not give dividends preferential treatment — most tax them as ordinary income — so the optional state field applies a flat rate to the whole dividend. Foreign dividends often arrive with tax already withheld at source (commonly 15% on many ADRs under tax treaties); that foreign tax is usually creditable against your US tax through the foreign tax credit, so in practice you pay roughly the higher of the foreign and US rates rather than both. The calculator models that simplification. As always, this is federal-first and leaves out the 3.8% net investment income tax that can apply at higher incomes.
— Reader questions
How are dividends taxed?
It depends on the type. Qualified dividends are taxed at the preferential long-term capital-gains rates (0%, 15% or 20% by income); ordinary (non-qualified) dividends are taxed at your regular income-tax rate. Enter your dividends and type to see the tax both ways.
What is the difference between qualified and ordinary dividends?
Qualified dividends meet IRS holding-period and source rules (most US stocks held long enough) and get the lower capital-gains rates. Ordinary/non-qualified dividends — from REITs, money funds, short holdings — are taxed as ordinary income, usually at a higher rate.
What is the tax rate on qualified dividends?
0%, 15% or 20%, depending on your total income. For a single filer in 2025, qualified dividends are taxed at 0% while income stays under about $48,350, 15% up to roughly $533,400, and 20% above. They stack on top of your other income to set the tier.
How much tax will I pay on $5,000 of dividends?
With $60,000 of other income (single), $5,000 of qualified dividends is taxed at 15% = $750. If they were ordinary dividends, they’d be taxed at your 22% rate = $1,100. Enter your figures to see your case.
Can I claim foreign tax withheld on dividends?
Usually yes — foreign withholding (often 15% on ADRs) is generally creditable against your US tax via the foreign tax credit, so you effectively pay the higher of the two rates rather than both. This calculator models that as a simplification; the actual credit has limits.