Solved

What is Blended Tax Rate? I got 14.1%. My taxable income is $31,000ish. Why not 12% (Tax Bracket rate)?

Forum|Forum|6 years ago
February 9, 2020
4 replies
0 views

No text available

TurboTax Deluxe Online

Best answer by DaveF1006

A blended tax rate also known as the effective tax rate is arrived at any number of factors. The effective tax rate for individuals is the average rate at which their earned income, such as wages, and unearned income, such as stock dividends, are taxed. If you received income from a variety of things like stocks and bonds, interest, dividends or self-employment, this may all play a role in determining your blended tax rate. It is hard to tell though without knowing what type of income you received during the year.

D

DavidD66

Your blended tax rate is the amount of tax you paid (or will pay) for the year, divided by your adjusted gross income (AGI). The 12% you mention is your marginal tax rate, it is the rate at which the last dollar you earned was taxed.

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

Y

yu0106Author

Where can I find the Blended Tax Rate table?

I found the link was told me my tax amount is $3611.

https://www.efile.com/calculate-your-income-tax-rate-by-bracket/

Taxturbo tells me my tax amount is $4456.

DaveF1006Answer

A blended tax rate also known as the effective tax rate is arrived at any number of factors. The effective tax rate for individuals is the average rate at which their earned income, such as wages, and unearned income, such as stock dividends, are taxed. If you received income from a variety of things like stocks and bonds, interest, dividends or self-employment, this may all play a role in determining your blended tax rate. It is hard to tell though without knowing what type of income you received during the year.

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

K

kol77

How is my blended tax rate 52.8% according to TurboTax Deluxe? This seems outrageous! I made considerably less money in 2019 compared to 2018, yet TTD is showing me a higher tax liability, in addition to a ridiculously high blended tax rate. ( I made less than $17k in 2019)

B

britt508

Wondering the same thing - my blended tax rate this year says 21.3% and my tax liability has more than doubled in the last year. We only made $3500 more in taxable income and are nowhere near a higher tax bracket. This makes zero sense.

D

Dslomer64

(Deleted by poster--me)

D

DavidLPeters

I am now working on my Taxes and my adjusted taxable income is only $6,354 but TurboTax says my Blended Tax rate is at 30.9%? so I own $1898 to Feds?

Something doesn't seem right about this.

Is TurboTax having issues with calculations. I should be at 10% lowest level.

S

sls50211

You must have other taxes from Sch 2 in additional to your income taxes that is driving the blended rate higher. Did you have self employment income? If you had a net profit on self employment income, you must pay self employment taxes on your net income. This is in addtional to your income tax. The rate is 15.3% of your self employment income. Did you have an Affordable Care Act premium credit repayment? Something is driving the blended rate to be more than your marginal tax rate, with is 10%. You can review your 1040 in the following steps:

While in your TurboTax account, select Tax Tools in the left margin
Select Tools
Select View a Tax Summary
In the left margin, select Preview my 1040
Scroll down till you find Sch 2. That schedule will have any additional taxes you are being assessed.
Select "Back" when done.

D

DavidLPeters

ahh...ya, most of my income is on 1099's.

so even with all my deductions and adjusted gross income so low I have to pay that much in Taxes? Dang.

R

rbarretto54

My blended tax rate was 306% !!??? How can it be? Last year it was 0%. And everything else was the same, same occupation, similar income, only the car was way more expensive.

M

MonikaK1

A blended tax rate, also known as the effective tax rate, is derived from a number of factors. The effective tax rate for individuals is the average rate at which their earned income, such as wages, and unearned income, such as stock dividends, are taxed. If you received income from a variety of things like stocks and bonds, interest, dividends, or self-employment, they may all play a role in determining your blended tax rate.

Also, this year, several tax credits have been lowered to amounts before the coronavirus pandemic—or eliminated entirely. This includes the Child Tax Credit, the Child and Dependent Care Credit, and more. Check if these changes affected your net tax.

Double-check your entries for income, taxes paid, and deductions to confirm they are correct. Compare the individual line items with last year's return as well, if applicable.

See this help article for more information.

For Federal income taxes, the tax rate brackets for 2022 are 10%, 12%, 22%, 24%, 32%, 35%, and 37%. To see how the tax brackets apply to you for this year, and for a tool to determine your marginal (the highest part of your income) tax rate, see here.

You can preview your return before filing to review the forms that TurboTax has prepared from your entries and to find out how your taxes were calculated. See here for details.

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