Aug. 30 (Bloomberg) -- Warren Buffett’s Berkshire Hathaway Inc. said dividends on its $5 billion in preferred shares of Bank of America Corp. will be taxed at a 14.175 percent rate because the securities will be held in insurance units.
“Virtually all of the stocks that Berkshire owns are held in its property-casualty subsidiaries, and that will be the case with the Bank of America preferred,” Buffett’s Omaha, Nebraska-based firm said today in a statement.
Berkshire issued the statement in response to a Wall Street Journal editorial that said the effective tax rate would be 10.5 percent. Ashley Huston, a spokeswoman for the Wall Street Journal, declined to comment.
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