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Deductions & credits
@soyuppy wrote:
LTCG does not change/affect your AGI.
That's not true. Long-term capital gain is included in AGI and in taxable income. When you enter long-term capital gain, it increases your AGI. Read the earlier replies above.
You did not do anything wrong in entering the long-term gain, but your interpretation of the results is wrong. The long-term capital gain does increase your AGI, and the increase in AGI affects other things in your tax return besides the tax on the long-term gain. The increase in AGI has side effects. The Qualified Dividends and Capital Gain Tax Worksheet is very complicated, but if you work through it slowly and carefully you will see that you are only paying 15% on the long-term capital gain. The additional increase in tax is because of the other things that are affected by the increase in AGI.
This has all been explained to you above. Again, read through the earlier replies more carefully.