topic It appears that my interest was taxed at 32% instead of 22%. My taxes started at 6722 then when I completed my taxes it said I owed 7589. Why? in Get your taxes done using TurboTax

It appears that my interest was taxed at 32% instead of 22%. My taxes started at 6722 then when I completed my taxes it said I owed 7589. Why?

Spazz — Wed, 11 Feb 2026 04:17:32 GMT

What else would be considered taxable income for a short form filer? Something that would add an additional
10%?

Re: It appears that my interest was taxed at 32% instead of 22%. My taxes started at 6722 then wh...

MinhT1 — Tue, 06 Feb 2024 23:27:36 GMT

It is difficult to answer precisely without seeing your tax return. I can think of several reasons for this increase:

1. Adding your interest could have pushed you to the next tax bracket which is 24%.

2. You may have to pay the Net Investment Income Tax (NIIT) of 3.8% on the interest/ See this IRS document.

3. Adding to your AGI may reduce your earned income tax credit.

The Earned Income Tax credit (EITC) is a bell shaped curve against income. The EITC rises with income until a certain level of income when it starts to decrease to reach 0 at the maximum level of income for the category.

As an example, please look at the EITC tables from page 27 of this IRS publication.

Re: It appears that my interest was taxed at 32% instead of 22%. My taxes started at 6722 then when I completed my taxes it said I owed 7589. Why?

SteamTrain — Wed, 07 Feb 2024 00:03:46 GMT

AND...if you are getting Social Security benefits, the interest entered could have made more of your SS income subject to taxation too.