Did Dividends Increase Immediately After the 2003 Reduction in Tax Rates?

The Jobs and Growth Tax Relief Reconciliation Act of 2003 reduces the maximum statutory personal tax rate on dividends from 38.1 percent to 15 percent. This study analyzes dividend declarations in the quarter following passage. Aggregate dividends rose by 9 percent when boards of directors first met following enactment. Consistent with the dividend changes being tax-motivated, they are increasing in the percentage of the firm held by individuals. Dividend changes also increased with insider ownership, consistent with managers acting in their own interests. However, these results are limited primarily to firms that made large, special dividends. We find little evidence of an increase in regular, quarterly dividend payments.

Capital Gains Taxes and Stock Reactions to Quarterly Earnings Announcements

This paper examines the impact of capital gains taxes on equity pricing. Examining three-day cumulative abnormal returns for quarterly earning announcements from 1983-1997, we present evidence consistent with shareholders' capital gains taxes affecting stock price responses. To our knowledge, this is the first study to link shareholder taxes and share price responses to earnings releases. The results imply that shares trade at higher (lower) prices when individual investors face incremental taxes (tax savings) created by selling appreciated (depreciated) shares before they qualify for long-term treatment. Unlike prior studies that have focused on price reactions in settings where shareholder taxes are unusually salient (e.g., tax law changes, turn-of-the-year trading, or tax-sensitive transactions), this study finds the imprint of capital gains taxes in a more general setting.

Did Firms Substitute Dividends for Share Repurchases after the 2003 Reductions in Shareholder Tax Rates?

This paper tests whether firms altered their dividend and share repurchase policies in response to the 2003 reductions in shareholder tax rates. We predict that firms substituted dividends for repurchases, because the reduction in dividend tax rates exceeded the reduction in the capital gains tax rates. As expected, we find substitution and find that it is increasing in the percentage of the company owned by individual investors, the only shareholders affected by the legislation. These findings are consistent with boards of directors considering the tax preferences of individual stockholders (particularly officers and managers) when setting dividend and share repurchase policies.

The Impact of Capital Gains Taxes on Stock Price Reactions to S&P 500 Inclusion

This paper contributes to our understanding of the determinants of price responses to inclusion in the S&P 500 by providing evidence consistent with capital gains tax planning impacting stock reactions. Tests are conducted on 426 additions from 1978-1999. We regress the returns on the first trading day following announcement on a capital gains tax measure and controls. The evidence is consistent with the share prices of appreciated firms being temporarily bid up to compensate individual shareholders for any unanticipated capital gains taxes triggered when they sell to index funds and the share prices of depreciated firms being temporarily diminished when individual shareholders sell because buyers and sellers share the tax savings associated with deductible capital losses. We infer from these findings that in rebalancing their portfolios after S&P 500 additions, index funds share individual shareholders' capital gains taxes (or tax savings) through sales price adjustments. Consistent with temporary price pressure, further analysis shows that much of the price reaction unwinds over the following week's trading. Finding that personal capital gains taxes affect stock returns in a setting that does not bias toward taxes mattering suggests that capital gains tax capitalization may be a pervasive feature in equity valuation.

Capital Gains Holding Periods and Equity Trading: Evidence from the 1998 Tax Act

This paper exploits an unusually powerful setting to explore a choice many individual investors face regularly the decision to sell today or postpone selling until lower rates are available in the future. We examine trading volume and stock returns around the 1998 reduction in the holding period required for individual investors to receive the most favorable long-term capital gains tax rate. For firms whose initial public shareholders were affected by the legislation, we find trading volume increasing and share returns decreasing in past price performance on the day the legislation was publicly disclosed. The results are consistent with capital gains holding periods distorting markets sufficiently that if investors are permitted to liquidate appreciated positions at favorable rates, enough will sell immediately to move prices. To our knowledge, this is the first study linking trading volume and security prices to a change in capital gains holding periods.

Men and Women in Space: Bone Loss and Kidney Stone Risk after Long-Duration Space Flight

Bone loss on Earth is more prevalent in women than men, leading to the assumption that women may be at greater risk from bone loss during flight. Until recently, the number of women having flown long-duration missions was too small to allow any type of statistical analysis. We report here data from 42 astronauts on long-duration missions to the International Space Station, 33 men and 9 women. Bone mineral density (dual-energy X-ray absorptiometry), bone biochemistry (from blood and urine samples), and renal stone risk factors were evaluated before and after flight. Data were analyzed in two groups, based on available resistance exercise equipment. The response of bone mineral density to flight was the same for men and women, and the typical decrease in bone mineral density (whole body and/or regional) after flight was not observed for either sex for those using an Advanced Resistive Exercise Device. Bone biochemistry, specifically markers of formation and resorption, generally responded similarly in male and female astronauts. The response of urinary supersaturation risk to space flight was not significantly different between men and women, although risks were typically increased after flight in both groups and risks were generally greater in men than in women before and after flight. Overall, the bone and renal stone responses of men and women to space flight were not different

United States Military Fatalities During Operation Inherent Resolve and Operation Freedom\u27s Sentinel.

BACKGROUND: Military operations provide a unified action and strategic approach to achieve national goals and objectives. Mortality reviews from military operations can guide injury prevention and casualty care efforts. METHODS: A retrospective study was conducted on all U.S. military fatalities from Operation Inherent Resolve (OIR) in Iraq (2014-2021) and Operation Freedom\u27s Sentinel (OFS) in Afghanistan (2015-2021). Data were obtained from autopsy reports and other existing records. Fatalities were evaluated for population characteristics; manner, cause, and location of death; and underlying atherosclerosis. Non-suicide trauma fatalities were also evaluated for injury severity, mechanism of death, injury survivability, death preventability, and opportunities for improvement. RESULTS: Of 213 U.S. military fatalities (median age, 29 years; male, 93.0%; prehospital, 89.2%), 49.8% were from OIR, and 50.2% were from OFS. More OIR fatalities were Reserve and National Guard forces (OIR 22.6%; OFS 5.6%), conventional forces (OIR 82.1%; OFS 65.4%), and support personnel (OIR 61.3%; OFS 33.6%). More OIR fatalities also resulted from disease and non-battle injury (OIR 83.0%; OFS 28.0%). The leading cause of death was injury (OIR 81.1%; OFS 98.1%). Manner of death differed as more homicides (OIR 18.9%; OFS 72.9%) were seen in OFS, and more deaths from natural causes (OIR 18.9%; OFS 1.9%) and suicides (OIR 29.2%; OFS 6.5%) were seen in OIR. The prevalence of underlying atherosclerosis was 14.2% in OIR and 18.7% in OFS. Of 146 non-suicide trauma fatalities, most multiple/blunt force injury deaths (62.2%) occurred in OIR, and most blast injury deaths (77.8%) and gunshot wound deaths (76.6%) occurred in OFS. The leading mechanism of death was catastrophic tissue destruction (80.8%). Most fatalities had non-survivable injuries (80.8%) and non-preventable deaths (97.3%). CONCLUSIONS: Comprehensive mortality reviews should routinely be conducted for all military operation deaths. Understanding death from both injury and disease can guide preemptive and responsive efforts to reduce death among military forces