provide a substantive response, making sure to extend the conversation by asking questions, offering rich ideas, or sharing personal connections to: A progressive tax rate schedule indicates that as a taxpayer earns more, they pay more of that income in taxes. Based on an individual's income they fall into different tax brackets that indicate how much of their income is taxable. The more money you make the higher tax bracket you fall into and the tax bracket you fall into determines what percentage of your income is taxable. Qualified dividends are normally taxed at a lower rate than ordinary income. They may be taxed at 0%, 15% or even 20% depending on your taxable income and filing status. Short-term capital gains are taxed using the progressive tax rate. These short-term capital gains are taxed the same amount as your ordinary income meaning it could be as high as 37%. Lon-term capital gains are taxed with preferential tax treatment meaning they can be taxed on the same scale as qualified dividends at 0%, 15% or 20% based off a taxpayer's income. The total tax rate is determined by an individual's total taxable income and filing status and is normally less than short-term capital gains tax rate