If your joint family income is less than $90,000 and you receive dividend payouts from holding shares, you may not owe federal taxes on those dividends—provided they are classified as qualified dividends.
Tax-Free Threshold
1. Qualified Dividends
Dividends paid by U.S. companies (or qualified foreign companies) on stocks held for a minimum period (usually 60 days).
2. 2024 Income Thresholds for 0% Tax on Qualified Dividends
In the U.S., qualified dividends are taxed at 0% only if your taxable income is below certain thresholds. For 2024, 0% rate applies if Filing Status Taxable Income Must Be Below:
- Single $47,025
- Married Filing Jointly $94,050
- Head of Household $63,000
If your total taxable income (after deductions) is below these thresholds, your qualified dividends are taxed at 0%.
Earn Non-Qualified Dividends
Non-qualified dividends (like from REITs, MLPs, or foreign stocks) are always taxed at ordinary income rates, not at the 0% qualified dividend rate. To make your dividends taxable. Invest in funds or stocks that pay non-qualified dividends.
❌ When You Do Pay Tax on Dividends
- Non-Qualified Dividends (e.g., REITs, MLPs, most bond funds): Taxed as ordinary income (10% to 37%)
- You Exceed the 0% Threshold: Tax rate on qualified dividends becomes 15% or 20%
Use Taxable Accounts
Ensure your dividend income is not sheltered in a tax-advantaged account, like:
- Roth IRA
- Traditional IRA (until withdrawal)
- 401(k)
Dividends in these accounts aren't taxed annually.
Avoid Overlapping Deductions and Credits
If your overall deductions (standard/itemized) and tax credits reduce your tax bill to zero, dividend income might also escape tax. To ensure it gets taxed:
- Reduce deductions (e.g., don’t over-contribute to pre-tax retirement accounts)
- Avoid refundable credits (like EITC) that might wipe out your tax liability
TIPS
To make sure you do pay tax on dividend income:
- Earn enough income to exceed the 0% qualified dividend bracket
- Choose investments that generate non-qualified dividends
- Keep investments in taxable accounts
- Don’t over-optimize deductions and credits
✅ Summary
Given your joint income is below $90,000, and assuming your dividends from Ford are qualified, you would not owe federal taxes on them for the 2024 tax year. Always consult your Form 1099-DIV to verify the nature of your dividends.
High Dividend Yield U.S. Corp. Stocks in S&P 500
| Ticker | Company | U.S. Corporation? | Headquarters |
|---|---|---|---|
| MO | Altria Group, Inc. | ✅ Yes | Richmond, Virginia |
| DOW | Dow Inc. | ✅ Yes | Midland, Michigan |
| WBA | Walgreens Boots Alliance, Inc. | ✅ Yes | Deerfield, Illinois |
| UPS | United Parcel Service, Inc. | ✅ Yes | Atlanta, Georgia |
| PFE | Pfizer Inc. | ✅ Yes | New York, New York |
| VZ | Verizon Communications Inc. | ✅ Yes | New York, New York |
| F | Ford Motor Company | ✅ Yes | Dearborn, Michigan |
| CVX | Chevron Corporation | ✅ Yes | San Ramon, California |
| PEP | PepsiCo, Inc. | ✅ Yes | Purchase, New York |
| T | AT&T Inc. | ✅ Yes | Dallas, Texas |
| XOM | Exxon Mobil Corporation | ✅ Yes | Irving, Texas |
| JNJ | Johnson & Johnson | ✅ Yes | New Brunswick, New Jersey |
| KO | The Coca-Cola Company | ✅ Yes | Atlanta, Georgia |
| PG | Procter & Gamble Co. | ✅ Yes | Cincinnati, Ohio |
| BAC | Bank of America Corporation | ✅ Yes | Charlotte, North Carolina |
Here's a comprehensive overview of your holdings, detailing each company's primary revenue sources, flagship products or services, founding year, and the launch year of their most iconic offerings:
| Company | Revenue Source(s) | Flagship Product/Service | Founded | Product Launch Year |
|---|---|---|---|---|
| Dow Inc (DOW) | Specialty chemicals and materials for packaging, infrastructure, and consumer care. | Styrofoam insulation | 1897 | 1941 |
| Pfizer (PFE) | Biopharmaceuticals, including vaccines and oncology treatments. | Comirnaty (COVID-19 vaccine) | 1849 | 2020 |
| Altria (MO) | Tobacco products, primarily cigarettes and smokeless tobacco. | Marlboro cigarettes | 1985 | 1924 |
| UPS (UPS) | Package delivery and supply chain management services. | Worldwide Express Shipping | 1907 | 1975 |
| Verizon (VZ) | Wireless communication services and broadband. | Verizon Wireless | 1983 | 2000 |
| Ford (F) | Automotive manufacturing and sales. | F-Series Pickup Trucks | 1903 | 1948 |
| Kraft Heinz (KHC) | Processed food and beverage products. | Heinz Ketchup | 2015 | 1876 |
| Chevron (CVX) | Oil and gas exploration, production, and refining. | Chevron Gasoline | 1879 | 1911 |
| PepsiCo (PEP) | Beverages and snack foods. | Pepsi-Cola | 1898 | 1898 |
| AT&T (T) | Telecommunications and digital entertainment services. | AT&T Wireless | 1983 | 1987 |
| CVS Health (CVS) | Retail pharmacy and healthcare services. | CVS Pharmacy | 1963 | 1963 |
| ExxonMobil (XOM) | Oil and gas exploration, production, and refining. | ExxonMobil Fuel | 1999 | 1911 |
| Johnson & Johnson (JNJ) | Pharmaceuticals, medical devices, and consumer health products. | Tylenol | 1886 | 1955 |
| Coca-Cola (KO) | Non-alcoholic beverages. | Coca-Cola | 1886 | 1886 |
| Procter & Gamble (PG) | Consumer goods including hygiene and health products. | Tide Detergent | 1837 | 1946 |
| Bank of America (BAC) | Banking and financial services. | Bank of America Checking Accounts | 1904 | 1904 |
Notes
- Dow Inc specializes in chemicals used across various industries, with Styrofoam insulation being one of its notable products since 1941.
- Pfizer's revenue is primarily from its Biopharma segment, with Comirnaty, the COVID-19 vaccine, being a significant contributor since its launch in 2020.Investopedia
- Altria is known for its tobacco products, with Marlboro cigarettes being a flagship brand introduced in 1924.
- UPS provides package delivery services, with its Worldwide Express Shipping service starting in 1975.
- Verizon offers wireless communication services, with Verizon Wireless established in 2000.
- Ford's F-Series Pickup Trucks have been a staple since 1948.
- Kraft Heinz's Heinz Ketchup has been a household name since 1876.
- Chevron has been supplying Chevron Gasoline since 1911.
- PepsiCo's Pepsi-Cola has been refreshing consumers since 1898.
- AT&T's wireless services began in 1987 under AT&T Wireless.
- CVS Health has been operating CVS Pharmacy stores since 1963.
- ExxonMobil's fuel products have been available since 1911.
- Johnson & Johnson introduced Tylenol in 1955, a widely used pain reliever.
- Coca-Cola has been offering its signature beverage since 1886.
- Procter & Gamble launched Tide Detergent in 1946, revolutionizing laundry care.
- Bank of America has been providing checking accounts since its founding in 1904.
