There are certainly plenty of reasons to fear the fiscal cliff.
Expansion-crushing tax increases and back-breaking spending cuts will kick in both political parties can't find common ground somewhere in the middle.
However, fiscal cliff fears -- and the meaty dividend declarations that they have inspired -- may be just the ticket to arm investors with the necessary pocket change to spend more than they were planning this holiday season.
Las Vegas Sands (NYSE:LVS) is only the latest company to declare a beefy distribution that will take advantage of the current 15% top tax rate on qualified dividends. With tax rates expected to rise to as much as 43% for some earners next year, companies want to make sure that they're handing over fistfuls of dough while investors still want them.
The casino operator will distribute $2.75 a share to investors on Dec. 18. Las Vegas Sands will be distributing $2.26 billion. What do you think that investors in taxable accounts will do with after-tax proceeds? It's a safe bet that some of that found money will go toward making this a merrier holiday shopping season.
It's not just Las Vegas Sands, of course. Plenty of companies have announced one-time dividends that will go out before the clock winds down on the 15% tax rate for qualified disbursements.
Let's go over some of the companies with beefy declarations.
- Fellow casino operator Wynn Resorts (NASDAQ:WYNN) coughed out a $8 a share dividend -- including its regular quarterly dividend of $0.50 a share -- last week.
- Sturm, Ruger & Company (NYSE:RGR) also knows where to aim. The gun maker will distribute $4.50 a share in cash to its stakeholders on Dec. 21.
- The board at Tyson Foods (NYSE:TSN) isn't chicken. The poultry giant revealed a modest special payout of $0.10 a share.
- As a foreign-flagged cruise ship operator, Carnival (NYSE:CCL) knows a thing or two about legally dodging taxes. The world's largest cruise line is paying a special $0.50 a share disbursement on Dec. 28.
The special dividends come in all sizes, but the end result is that the companies are sending billions in tax-advantaged qualified dividends to its stakeholders at a time when consumers are careful about not maxing out their credit cards.
You won't find too many nice things to say about the fiscal cliff, but here's a case where fears of chunkier tax rates on dividends come 2013 is injecting some serious money into this economy now.
Checks and balances
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