Thanks for the reply.
That is the issue that I am having. When I follow the formula you outline for my Taxable Income, I end up with an effective tax rate of less than 21%. However, the Blended Tax Rate used by TurboTax at that step is 26.0%. It then uses that 26.0% to calculate the Tax Liability, which is much higher than expected. How does TT arrive at that number (26.0%) for the Blended Tax Rate for their calculation? It does not match up with the tax amount nor resulting effective tax rate per the IRS formula.
