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Dividend tax in United States 2026
Qualified dividends — most dividends from US and treaty-country companies held over 60 days — are taxed at just 0%, 15% or 20% depending on income, far below ordinary rates.
Add the 3.8% net investment income tax above $200,000/$250,000 and the practical top rate is 23.8% federal.
Non-qualified dividends (short holdings, some foreign payers, ordinary payouts from real estate investment trusts) fall back to ordinary rates up to 37%.
At a glance
- top rate
- 20% + 3.8% surtax = 23.8% (qualified)
- entry band
- 0% up to $49,450 single / $98,900 joint taxable income
- tax year basis
- Calendar year
- filing deadline
- 15 April return; no withholding for compliant residents
- residency basis
- Citizens/residents: worldwide dividends
- regime flag
- Non-residents: 30% withholding, treaty-reducible
Rates
Dividend taxation (2026)
| Taxable income (USD, single / joint) | Qualified-dividend rate | Note |
|---|---|---|
| Up to 49,450 / 98,900 | 0% | |
| To 545,500 / 613,700 | 15% | |
| Above that | 20% | +3.8% net investment income tax over $200k/$250k |
| Any income level | Ordinary rates to 37% | Non-qualified dividends (short holding periods, certain foreign payers) |
Marginal rates apply within each band.
Thresholds & allowances
- Qualification test61 days' holding around the ex-dividend date
Plus a US or qualifying treaty-country (or US-listed) payer
Surcharges
- Net investment income tax3.8%over $200,000 single / $250,000 joint
Residency
Residency trigger
Citizens and residents pay US tax on dividends worldwide; foreign withholding is credited via the foreign tax credit.
Non-resident treatment
Non-residents face a 30% final withholding on US dividends, cut to 15% or less by most treaties; no US return is needed if withholding was correct.
Notes
- The United States runs a classical system — no imputation credits — so the 0/15/20 rates are the relief for corporate tax already paid.
- Dividends inside 401(k)s and IRAs compound untaxed until withdrawal (or tax-free in Roth accounts).
- State income taxes typically tax dividends at ordinary state rates — the federal preference does not carry over everywhere.
FAQ
How are dividends taxed in the United States?
Qualified dividends at 0%, 15% or 20% by income (plus the 3.8% surtax at high incomes — 23.8% top); non-qualified dividends at ordinary rates up to 37%.
What US tax applies to dividends paid to foreigners?
A 30% final withholding, reduced to 15% or lower under most tax treaties. Portfolio interest and bank interest, by contrast, leave the US untaxed.
Figures: tax year 2026, compiled from public sources. Not tax advice.