We made more money this year and had more tax breaks but we paid less taxes? Also our standard deduction this year is 24,000 but last year was 24,850, why?

Forum|Forum|7 years ago
June 4, 2019
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Best answer by Vanessa11_2

The simplest answer is likely the tax law changes. More tax breaks equal lower taxes. Also, depending on how much you made this year and last year, the tax brackets broadened slightly and the tax rates dropped.

So for instance, last year if you were married filing jointly and made $100,000 you were in the 25% tax bracket. This year for the same status if you made $125,000 you are in the 22% tax bracket.

As for the standard deduction, last year if you had a deduction of $24,850, you would have taken the itemized deduction as the top amount for Married filing jointly (not blind and under 65) was $12,600. This year, the standard deduction has almost doubled to $24,000 making it unnecessary for many people to itemize their deductions.

You can do a line by line comparison on your return, but since the lines have changed you will need to compare wording instead of lines (ex. AGI to AGI, not line 38 to line 38)

Here is a link to a tax bracket calculator which likely has a bit to do with your decrease in taxes paid. https://turbotax.intuit.com/tax-tools/calculators/tax-bracket/

Vanessa11_2Answer

Level 13

So for instance, last year if you were married filing jointly and made $100,000 you were in the 25% tax bracket. This year for the same status if you made $125,000 you are in the 22% tax bracket.

You can do a line by line comparison on your return, but since the lines have changed you will need to compare wording instead of lines (ex. AGI to AGI, not line 38 to line 38)

Here is a link to a tax bracket calculator which likely has a bit to do with your decrease in taxes paid. https://turbotax.intuit.com/tax-tools/calculators/tax-bracket/

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