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Get your taxes done using TurboTax
The blended tax rate is calculated by dividing tax by income. Income is based on adjusted gross income (AGI) from Form 1040, line 11, but it may include additional amounts if there any. Tax starts with the amount on line 18 of Form 1040, including alternative minimum tax, but excludes some additional taxes like recapture tax. Certain nonrefundable credits, such as the Child Tax Credit, Fuel Tax Credit, and refundable portions of other credits, are subtracted from the tax amount. If you have any of these credits, this is likely why your blended rate is lower than you would expect. If refundable credits are larger than the tax, the effective tax rate can even be negative.
February 16, 2025
4:38 PM