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Solved

Where To Input Investment Income On Quarterly Estimated Tax 1040-es Form?

Forum|Forum|4 years ago
April 8, 2022
1 reply
0 views

Where is the best place to input investment income, e.g., interest, dividends, and etc., on the quarterly estimated tax 1040-es form?

"Investment Income Election" is listed on the Quarterly Estimated Tax 1040-es forms and seems like it could include investment income. However, this produces a result where TurboTax calculates no taxes are owed.

When the investment income is included in the "Other Income and Losses" category this produces a more expected quarterly estimated tax owed.

What are "Investment Income Elections" if this is not for investment income?

After further research it seems this item is used for deducting interest expenses paid on "non-passive" investments - What Are Deductible Investment Interest Expenses?

Much appreciated!

Best answer by ThomasM125

You won't have any federal tax on capital gains or qualified dividends if your taxable income is less than $40,400 (single filer) or $80,800 (married filing joint.) That may be why when you enter investment income your tax doesn't change. If your income is over those amounts, your investment income would likely be taxed at ordinary income tax rates. In that case if you enter it as other income the correct tax should be calculated from it.

Please clarify your question. What state are you preparing. States tax income differently.

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adamhurwitzAuthor

Thanks for the reply! This is for the Federal 1040-es form. This is not for the state portion.

Resources

Estimated Taxes: How to Determine What to Pay and When - TurboTax, 2/24/22
Can TurboTax calculate next year's federal estimated taxes? - TurboTax, 1/7/22

ThomasM125Answer

You won't have any federal tax on capital gains or qualified dividends if your taxable income is less than $40,400 (single filer) or $80,800 (married filing joint.) That may be why when you enter investment income your tax doesn't change. If your income is over those amounts, your investment income would likely be taxed at ordinary income tax rates. In that case if you enter it as other income the correct tax should be calculated from it.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"