I entered all of the info needed then did a quick check on paper and the amount due on Turbo Tax is off by about $1000 so I chatted with the bot because it looks like TurboTax isn't factoring in the personal exemption in Maine.
This is our conversation which is really concerning and should be looked into but there's no where to talk to an actual person live without paying. Thanks for any help
CONVERSATION:
ME: I am doing very high-level calculations without even getting into the nitty gritty details - gross income, minus the standard deduction (married filing jointly - Maine uses the federal standard deduction), subtracting the state's exemptions for married filing jointly (5150 for each adult), $8057 plus percentage over certain income level, and it comes out to $2596. Not $3409 like TurboTax says. Maine uses the federal standard deduction amounts.
BOT: For 2024, the standard deduction for married filing jointly is $29,200. Additionally, Maine allows personal exemptions of $5,150 per adult.
ME: We're filing taxes for 2025 not 2024
BOT: Maine state income tax rates for married filing jointly in 2025 are graduated with a top rate of 5.5%. You need to apply these rates progressively across income brackets to calculate tax liability accurately. Your simpler calculation may not reflect the graduated rates, causing a difference from TurboTax's figure.
ME: The 2025 top tier rate is 7.15% ...
BOT: For Maine in 2025, the top state income tax rate is indeed 7.15% for higher incomes if filing married jointly.
The state uses progressive tax brackets for married filing jointly status. You must apply each tax rate to the portion of income within each bracket, not a flat rate on total taxable income. Personal exemptions remain at $5,150 per adult, and the state follows the federal standard deduction.
