One reason buybacks are so popular in America is that, for investors in the highest tax bracket, capital gains are taxed at more favourable rates than dividends.

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Households in the 15 percent tax bracket and below will see their tax on capital gains go from zero to 10 percent and their tax on dividends will rise from zero to 15 percent.

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The bill would raise rates on long-term capital gains and dividends for top-bracket taxpayers to 20% for 2013 from 15% in 2012.

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Paul Panzera, director of sales at SCA Promotions, said his company had been putting its capital on the line in perfect-bracket contests for more than a decade, backing competitions that have collectively garnered millions of entries, and the closest anyone got was 59 of the 63 games.

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If your gain is earned for more than one year, then you are taxed at either of two capital gains rates, depending on your tax bracket.

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And the investment growth is taxed at their income tax bracket, which for most is higher than the 15% capital gains tax rate.

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But the law also imposes for the first time ever a 3.8 percent Medicare tax on passive, or unearned, income, such as capital gains and dividends, for people in that same tax bracket.

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Capital gains tax will increase from 0% to 10% for investors in the 15% bracket (8% for gains held more than 5-years), from 15% to 20% for all others brackets (18% for gains held more than 5 years).

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As it stands today, the capital gains tax will increase from 0% to 10% for investors in the 15% bracket (8% for gains held more than 5 years) and from 15% to 20% for all others brackets (18% for gains held more than 5 years).

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