Business & farm

To add to Carl's post ... the depreciation recapture is taxed at a max of 25% and the cap gains at a max of 15% or 20% and the ordinary income at the effective tax rate (since we are on a graduated tax system)  so the total tax paid could be lower than any of those caps.  If your income is high enough that you are at the 20% cap gain limit you may also be hit with the NIT tax of 3.8% so review the return and all the worksheets carefully.

 

If you use the downloaded program you can do some "what if / test " returns ...

 

If you want to play around with different figures and tax scenarios without affecting your original return you can

In the TurboTax CD/Download software by creating a test copy:

  1. Open your return in TurboTax.
  2.  From the File menu, choose Save As.
  3. Give the copy a new name to distinguish it from the original (for example, by adding "Test" or "Example" to the file name).
  4.  Click Save. You are now safely working in the test copy and anything you do here will not affect the original.

In TurboTax Online, you'll have to create a test account separate from your regular TurboTax account and create a test return there. We recommend adding "test" or similar to your User ID so you can easily distinguish it from your actual account.

 

Or use the WHAT IF tool: 

- Click Forms Icon (upper right of screen) or Ctrl 2 (forms view)

- Click on the Open Form Icon

- In the “Type a form name..” area type What-If (with the dash), click on the name of the worksheet - click on Open Form

- You will see the worksheet on the right side of the screen; enter the information right into the form

- To get back to interview mode - click on the Step-by-Step Icon (upper right of screen) or Ctrl 1

 

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