In T-Tax, our new 'taxable income' is correct (and in lower bracket now) but the tax due is calculated using higher tax bracket.
How do you know it's using the wrong bracket? Yes Turbo Tax recalculates it everytime you make an entry.
If you have the Desktop program you can switch to the Forms Mode and open the Tax worksheet and see how it's calculated. Probably on the Qualified Dividends and Capital Gain Tax Worksheet.
I compared the tax rate schedule for our taxable income($29498 owed) to what Turbo Tax calculated ($31864). So seems it used 28% tax rate, not 25%. BUT, thanks to your info ... although I can't find that worksheet in the forms, I did see that on line 44 on 1040, tax is correct at $29498. THEN, my self-employment tax got added to come up with the "total tax" ... that is why it looks like higher tax rate applied. Thank you so much for your great advice!