Why does tax caster show a 30% less in taxes owed than Turbo tax 2017 program. I put in the exact same information for both. What is the difference?

Forum|Forum|7 years ago
June 4, 2019
4 replies
51 views

The review in tax caster is the exact same as figures in Turbo tax, yet tax amount is less in tax caster. The amounts entered are exactly the same from income and deductions.

TurboTax Premier Windows

Best answer by SweetieJean

The TT program is not finalized yet (but be sure to run an update), and I believe Taxcaster doesn't calculate some penalties. Did you take an early withdrawal from a retirement plan for example?

And 30% is relative. For example, $70 v. $100 is not a lot.

SweetieJean

Alumni - Champ

You are asking from Premier? Do you have investments, rental property, K-1 forms? Taxcaster may not handle those well.

donupdyAuthor

Level 2

No, just some investments. I did not put those in yet though. The difference was about $1800 in tax more from TT

SweetieJean

Answer

Alumni - Champ

The TT program is not finalized yet (but be sure to run an update), and I believe Taxcaster doesn't calculate some penalties. Did you take an early withdrawal from a retirement plan for example?

And 30% is relative. For example, $70 v. $100 is not a lot.

dmertz

Level 15

To make the estimating simpler, TaxCaster makes various assumptions. TaxCaster generally calculates only income and self-employment taxes. It does not calculate various penalties such as penalties for early distributions from retirement accounts.

Even though 2017 TurboTax is not finalized yet, in most cases 2017 TurboTax will give a more accurate result than will TaxCaster. Errors due to 2017 TurboTax not being finalized will be small in almost all cases since these errors are generally the result of cost-of-living adjustments. (Of course this likely won't be true for 2018 taxes when there will be major changes resulting from the new tax law.)