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March 10, 2025
Question

why less traditional IRA contributed, more blended tax rate increased, if no any IRA, the blended tax rate increased to 19%. Is it normal

  • March 10, 2025
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why less traditional IRA contributed, more blended tax rate increased, if no any IRA, the blended tax rate increased to 19%. Is it normal

1 reply

March 10, 2025

Yes, that makes senses.  Traditional IRAs are a tax deduction, so the less traditional IRA contributions you make, the higher your blended rate will be.

 

The blended rate includes both regular tax and self-employment tax. The formula is tax liability divided by taxable income. This rate is for your information only. It is not used anywhere else.

 

Here is an article you may find helpful: What is My Tax Bracket?