Blended tax rate will fluctuate based on income, but also based on how certain income is taxed. If you had Capital gains, a home business or other special taxes, they would be a factor. Also, tax credits are not deducted from the total tax for the calculation.The Blended tax rate is calculated under Federal / Federal Review To access it, all questions must be answered in the Federal Review. At the end of the questions. Look at the bottom of the screen It will say Get a detailed view of your numbersThe Blended Tax rate is: 1040 Line 18 divided by Line 15 Tax liability, Total Tax Line 18 Including SE tax, capital gain and special taxes Taxable income, Line 15 Total income minus deductions, but before credits To compare Blended rates from previous years you will need the earlier tax returns.

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danac

Question

Why is my blended tax rate so much higher when my income is lower than last year?

Forum|Forum|1 year ago
April 7, 2025
1 reply
0 views

No text available

JohnB5677

Blended tax rate will fluctuate based on income, but also based on how certain income is taxed.

If you had Capital gains, a home business or other special taxes, they would be a factor.
Also, tax credits are not deducted from the total tax for the calculation.

The Blended tax rate is calculated under Federal / Federal Review

To access it, all questions must be answered in the Federal Review.
At the end of the questions. Look at the bottom of the screen
It will say Get a detailed view of your numbers

The Blended Tax rate is: 1040 Line 18 divided by Line 15

Tax liability, Total Tax Line 18
- Including SE tax, capital gain and special taxes
Taxable income, Line 15
- Total income minus deductions, but before credits

To compare Blended rates from previous years you will need the earlier tax returns.

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danacAuthor

Thank you. I did the math and dividing line 18 by line 15 gives me a blended tax rate of 10.4%. That is far below the 42.5%. What should I check in the entries I have made to my tax form to fix this?

danacAuthor

Additional info: my taxable income decreased quite a bit this year from last year, while my blended tax rate increased from about 32% to 42%. I had no other changes from last year to this year other than my income decreasing. Why would this happen?