The qualified dividend and capital gain tax worksheet is a helpful worksheet that assists taxpayers calculate the reduced tax rate on their qualified dividend income and long-term capital gains.
Generally, qualified dividends and long-term capital gains are subject to alternative tax rates from the regular ordinary federal income tax rates for individuals. The tax rates are either 0%, 15%, or 20%, depending upon the individual’s taxable income for the year.
To determine which reduced rate applies, the individual taxpayer must complete the QDCGTW with their Form 1040 tax return.
Taxpayers can find the worksheet in the Schedule D instructions. For a sample tutorial on how to complete the worksheet, please view our tutorial video here.