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Were you in a combat zone? If not all of the money earned is taxable.
Let's start with what the different blocks mean.
BOX 1 Is your taxable Earnings (Total money received less certain exclusions)
BOX 2 Is the Federal Tax that was withheld from BOX 1
Box 3 & 5 are Social Security & Medicare Income respectively
NOTE: Boxes 3& 5 are usually the total value of everything you received with a few exceptions)
I noted that you stated that a portion was reserve pay. That suggests that you have another job. If you work multiple jobs, or if you have a spouse that works, you may not have had enough taxes withheld.
Each job that you work will calculate the tax withholding for that job alone. As you add additional W-2's your income will continue to go up, but the amount withheld will be at a lower taxable rate.
The 6 months deployment was in a combat zone. The W2 is just my military W2. I am assuming that the non-taxable combat pay is just left off the block 1 but accounted for in block 3 and 5. So everything in block 1 is what I made state side in a Reserve status. I read where there were some issues with the military W2s and I was wondering if this was the problem. It just didn't seem correct that I made 70,000 in combat pay (6 months), 15,000 in taxable pay, paid 1500 in taxes but it raised my tax amount due by 2500. So in theory I paid 4000 on 15000 of income for military. The only other issue I could see is if that 15,000 sent me into a higher tax bracket?
I conducted a test on your situation and determined that the taxable wages are calculated correctly. The program does exclude the combat pay. There may be other income items and credits that are affecting the tax liability. I recommend re-checking your errors and requesting an explanation in a Off-line review.
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