Question

Why is the federal tax calculated by TurboTax about $10000 dollars less than the tax table says it should be for my taxable income (calculated by Turbotax)?

Forum|Forum|6 years ago
August 18, 2019
1 reply
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TurboTax Premier Online

M

mesquitebean

Employee

There are several ways that TurboTax uses to calculate taxes depending on the requirements of your return.

Tax Tables are only used as a sole method when there are no other factors in the calculation.

For instance, here's a common situation. Do you have any capital gains or qualified dividends? If so, then your tax is calculated on the "Qualified Dividends and Capital Gains Tax Worksheet." That results in lower tax than the tax tables due to the favorable treatment of those items.

In my next comment below I'll tell you how to check in your return to see what method(s) TurboTax used to calculate your tax.

M

mesquitebean

Employee

If you're using Online TurboTax, here's how to see what method(s) TurboTax is using to calculate your tax.

With your return open, click in the left menu column on TAX TOOLS, then TOOLS.
In the Tools window choose "View Tax Summary."
On the Tax Summary screen, click in the left menu column on "Preview My 1040".
That will open the Form 1040 Worksheet.
Scroll down, and below Line 10, you sill see a "Tax Smart Worksheet", which should show your calculation method.

G

Gordonmacwilliam

Employee

When I tried this, steps 1 and 2 could be completed, but there was no step 3 "Preview My 1040" option in the left menu column. The left menu column did not change at all.