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Retirement tax questions
Right...you are including SE tax, and probably shouldn't.
Those who get only W-2 income don't have their SS&Medicare tax included as a part of that calculation, so you shouldn't either.
THUS: from the 2022 Form 1040, TTX appears to use line 22 divided by Line 11 (AGI)
Either that or I "guess" TTX could start including the SE/Medicare/SS taxes for everyone as a part of that calculation, but historically, they haven't.
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Like I said...it's just a handwaving number to see where you sit relative to most everyone else. And perhaps TTX adds in some other taxes from the Schedule 2, even though they don't include the SE tax in the calculation.
You don't have to use TTX's effective rate...use whatever generic calculation you want.
____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*
‎October 27, 2023
4:23 PM