We sold stock. It is a long term capital gain and our adjusted gross income is such that there should be no tax yet we appear to getting taxed on it. Why?

[MinhT1]

Long term capital gains are taxed at 0% if your tax bracket is 12% or less (less than $41,675 of taxable income for Single or MFS or less than $83,350 of taxable income for MFJ)..

However, long term capital gains are included in your taxable income for the calculation of your tax bracket, and that part of long term gain which crosses over $41,675 (Single or MFS) or $83,350 (MFJ) is taxed at 15%.

[Taxmom18]

Thank you for your reply. We are filing joint married and our income is well below $83000 but we are still being taxed. Anything else you can suggest?

[Vanessa A]

Are you getting taxed or are you losing credits?  How much was the stock sale?  Did it boost your income above the $83,000?

Best thing to do is to look at your 1040 with the stock sale entered and then remove it and compare the numbers.   This will tell you where it is coming from.  It could be something like the sale of stock is removing a credit like the Earned Income Tax Credit or an education credit. 

[Taxmom18]

Thank you all for your help. In addition to your help, we spoke with Curtis at TurboTax and he pointed us to the Qualified Dividends and Capital Gains Tax Worksheet which displays when you click on the Forms options in the upper right hand corner of the screen. The information provided there did indeed showed us that the capital gains were taxed at 0%.