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July 6, 2020
Question

Why is my blended tax rate in 2019 higher than 2018 if my AGI is similar? 2018 - 7.93% 2019 - 15.7% I used Turbo Tax both years.

  • July 6, 2020
  • 2 replies
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2 replies

Employee
July 6, 2020

Did you have self employment income in either of the two years?

Did you change your filing status? 

Did you have dividend income, qualified dividends shown correctly?

Did you have a child tax credit? Does it show on both years?

https://turbotax.intuit.com/tax-tips/irs-tax-return/what-is-my-tax-bracket/L3Dtkab8G

https://ttlc.intuit.com/community/after-you-file/discussion/how-to-i-print-the-summary-sheet-that-includes-information-like-effective-tax-rate-now-that-i-have/00/1082113

Disclaimer: Not a tax professional. Information gathered from internet links. Anything dated in June 2019 was posted in prior years and is before the 2019 limits and changes.
SusanY1
July 6, 2020

This can happen for a number of reasons, and it's hard to say for sure without being able to review your return with you or see your screen.

 

The most common reason is a reduction in, or loss of, certain tax credits such as the child tax credit (which changes in the year a dependent child turns 17, education credits, or child and dependent care credits.)

 

These credits are generally lost due to reasons other than an increase in income (change in age or graduation from school), which is why the effective or blended tax rate can vary when they are removed from the tax calculations.

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