Get your taxes done using TurboTax
I believe what you mean is when you enter the stock sale in TurboTax, your tax goes up by $2,186 and based on the capital gain on the sale, that would be a tax rate of 37.7%. What you're failing to take into consideration is that the increase in tax is not simply the tax on the capital gain income, but a consequence of the effect the additional income has on other things associated with your income tax.
You may have tax credits that are sensitive to increases in income, you may have alternative tax or investment tax issues that are affecting your total income tax when you add the gain from the stock sale to your tax return.
I suggest you look at your Form 1040 and schedules one to three before you add the additional income and after to see what changes. You will likely see other things that change in addition to the total income tax.
To view your form 1040 and schedule 1 to 3:
- Choose Tax Tools from your left menu bar in TurboTax Online while working in your program
- Choose Tools
- Choose View Tax Summary
- See the Preview my 1040 option in the left menu bar and click on it
- Choose the Back option in the left menu bar when you are done
After you pay for your TurboTax program you can see the forms and schedules in your return. You will see the Tax Smart Worksheet which will tell you where your tax is being calculated, which will show you that it is more than simply applying a tax rate to your taxable income:
