Potential Taxes on Taxable Account

[heybro]

Let me know if I have this right.

I buy a SP 500 ETF and sell shares only after holding the fund for one year or more.  Sometimes I sell them at a gain and sometimes I sell them at a loss.

Potential Taxes:

Taxes Because I sold after one year and gained money:

1. Long Term Capital Gains

0% Federal since I make less than $39,375



Taxes because I simply held the fund and it paid dividends:

2. Qualified Taxes on Dividends

0% Federal since I make less than $39,375


3. Non-qualified Taxes on Dividends

10% and 12% Federal (taxed as normal income)



If the above is accurate, consider these two funds IVV and VOO.

Since neither has non-qualified dividends, I would pay 0% Federal Taxes on dividends and gains.

Am I Right?

[MDM]

Close.

You have to hold the shares for more than one year.  Selling after exactly one year is short term.

Depends on what you mean by "make."  E.g., you don't get to pay 0% federal on $1 million of LTCG just because your W-2 income is only $30K. ;)

See https://www.irs.gov/pub/irs-prior/i1040gi--2018.pdf#page=40 for how the federal tax calculation is done.