Interest Income?

I presume interest income is treated as regular income, so if the last dollar I pay tax for the year is getting hit at 28% by Uncle Sam, then in effect my interest income will be taxed at 28% that year. In comparison, taxable dividents from a mutual fund are taxed at 15% (fixed, assuming it is qualified... I understand I would not qualify for the 5% due to my income level). Am I correct in my understanding? So why would I put money into interest baring accounts (other then some need for liquidity)?

You can't be serious. Asking tax advice from us and you don't know what our credentials are? See a tax preparer or tax consultant.

Most people put money into banks for the liquidity, convenience, low risk tolerance and because they don't know better.

Good luck.

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