Bank speeds payout to avoid taxes

National Penn Bancshares, Boyertown, is speeding up its ten-cents-a-share dividend payment, which would typically fall due in January, to Dec. 28, for shareholders as of Dec. 13. 

Amazon, Costco, eBay, and other large companies have declared large special dividends so they can give away cash to shareholders in advance of a threatened federal tax hike -- one of the "Fiscal Cliff" revenue-boosters that will take effect Jan. 1 unless Congress and the President make a deal to ease the impact.

"Under current law, the federal income tax rate on dividends is going to increase from 15 percent to more than 40 percent" for taxable investors in the upper-income brackets, Scott V. Fainor, National Penn chief fiancnail officer, told me. 

"Even if there is legislative action this month ot address fiscal concerns, including action on this tax rate, we expect the tax rate on dividends to increase materially in 2013." So merry Christmas!

Amazon and eBay shares surged on the news, according to Bloomberg. National Penn shares were little changed in trading today.

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