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Hi, my taxable Income, filing jointly with my spouse, is $14,488. And the TurboTax is states my Blended Tax Rate is 34.7%. Shouldn't it be only 12%?
Shouldn't it be only 12%?
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Get your taxes done using TurboTax
IF you are self-employed, They may be including Self-employment tax (SS and Medicare) that is just at 15.3% of your SE profit.
That SE tax is applied before your personal deductions are used to reduce your AGI to the "taxable income" level.
Thus, a married couple could have all Self-employment income of 38,500
then Roughly:
~15% of that is $5775 SE tax
...then 38,500 - 24,000 std Ded for MFJ = 14,500
...tax on that is ~$1450
Total tax : 5775 + 1450 = 7225
= 50% of taxable income
= 19% of AGI
(50% + 19%) / 2 =34.5% blended? a WHOLE LOTTA Handwaving there
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You gotta decide what number you want to focus on...not sure the "blended" number is meaningful, but then I'm just guessing as to how they calculated it. A simple % of AGI would be more meaningful to me.