Most of our income comes from W-2s, but I have one 1099-NEC for $5,000. After it's all said and done, adding that one NEC increases our Federal taxes due by $2,326 and my state taxes (CA) by $451. I know NECs are taxed differently (income tax + 15.3%), but nothing I've come across explains how I would end up paying $2,777 in taxes on 5K. We are filing jointly and our income is in the "$89,451 to $190,750" / 22% bracket. I'm figuring at most 5K at 37.3% -- for Federal taxes -- would be 1,865 not 2,326... I would be thankful for an explanation if anyone can figure this out. Thanks!
