On my 1040-Sr I have a taxable income of $39,387.00 on line 15. Turbo tax put $0.0 on line 16. The tax table shows $4015.00 tax for this amount???"

[DoninGA · Accepted solution]

Do you have any qualified dividends or capital gains being reported on your tax return?  If so, then the tax tables are not used.  The Qualified Dividends and Capital Gains Worksheet is used.

IRS Form 1040 Instructions Qualified Dividends and Capital Gains Worksheet on page 36 - https://www.irs.gov/pub/irs-pdf/i1040gi.pdf#page=36

[cooptsg]

Hi,

Yes and thanks to the Turbo Tax Community. You pointed me in the right direction.

So, here's what I found and the recommend for anyone else who is interested.

1. When the tax calculation on line 16 on the 1040 or 1040-SR looks incorrect.
2. Does the individual have any capital gains reported via 8949.
3. Were the capital gains classified long term.
4. Based on the individual's file status and AGI (Adjusted Gross Income) reported on line 11 of 1040 or 1040-SR.
5. There will be a tax rate of 0% to 20% for tax year 2024 based on the above factors to the Long-Term gains

Note: Keep in mind that capital gains classified as Short Term, will be taxed as ordinary income based on the individual's tax bracket.  With a combination of Short- and Long-Term gains there will be a blended overall tax rate for your return.

I hope that helps.