I have created an Excel spreadsheet that mimics the tax return since 2014. For tax years 2014 to 2019, I have been exact with one exception; off by $1.00.
That is because the Excel spreadsheet does not round up or down. If I entered $4,546.89, I keep it. IRS and all tax software will store it as $4,547.
For tax year 2020, I am off by $30.00. My tax liability within my Excel spreadsheet states $X.00 and TurboTax states $X minus $30.00. So I am getting $30.00 more as a refund.
My taxable income does not hit any "fees"/"penalties"/etc. I have not crossed the SSI max amount either which is $8,537.40. Medicare does not have a max amount.
I understand the 10%, 12% and 22% tax brackets; which I used for taxable/ordinary income. I have qualified dividends, taxed at 15%.
I looked all entered values within Turbo Tax and the Excel spreadsheet; they are exact taking into account the "rounding up/down".
From previous posting, tax experts stated, some components are taxed at different rate. Can you explain which components are not taxed using the gradient scale, 10%, 12% and 22% for ordinary income and 15% for qualified dividends?
I think that Turbo Tax is using an incorrect deduction and/or tax bracket limits; ie 10% at $19,750.
If I have incorrectly thoughts of something, I would like to understand so I can expand my knowledge. I am not saying I am right. Just sharing my experience.
Thanks in advance
