Back to top

Real Time Insight

Congressional Republicans and Democratic leaders still appear to be quite a ways apart when it comes to how they want to proceed with the Fiscal Cliff. Just in the last day or so, Republicans have called Obama’s latest fiscal cliff deal proposal—which includes $1.6 trillion in revenues-- a non-starter, while key Democrat Harry Reid declared that he ‘doesn’t understand John Boehner’s brain’.

With this kind of rhetoric, one should probably assume that the Fiscal Cliff debate could last for a bit longer. However, one thing seems for certain; tax rates are going to go up (read Three ETFs to Prepare for the Fiscal Cliff).

While we can debate about how much higher the top rate will go, and if dividend taxes will shoot into the mid-40% range, the real question is does it matter? Will these (in some cases) sharply higher rates really change how people invest their money?

Personally, I don’t really think it will change how I invest for the long-term. Yes, a higher tax rate isn’t exactly great news, but what can be done?

There aren’t many other options out there to achieve a decent return over the long haul, especially if rates go up across the board. Stocks will remain the best bet even with sharply higher rates, so I think that while investors may complain, they won't really change too much about their portfolios.

But what about you?

If we do see higher tax rates for income and dividends, will you alter your investment strategy?

Let us know what you think in the comments below!

Just Released: 5 Stocks to Double

Today, you are invited to download a free Special Report from Zacks Investment Research. It reveals five moves that could gain +100% and more in the next 12 months:

One is a "boring" business delivering blistering growth. Another is a red-hot oil and gas producer set to surge on a drilling breakthrough. Still another, an online payment provider, ignited a 53% sales explosion during the past year.

Close This Panel X

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
SUPER MICRO… SMCI 27.00 +10.25%
CANADIAN SO… CSIQ 38.34 +8.18%
BANCO DO BR… BDORY 16.78 +8.05%
CENTURY ALU… CENX 26.97 +7.97%
WILLDAN GRO… WLDN 11.38 +5.86%