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shell73
New Member

what is a blended tax rate

 
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2 Replies
KrisD15
Expert Alumni

what is a blended tax rate

Blended rate is 

your tax liability including Capital gain tax, Self-Employment Tax and other additional taxes if applicable (Form 1040 line 16)

divided by your taxable income (Form 1040 line 15)

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rjs
Level 15
Level 15

what is a blended tax rate

The blended tax rate is an attempt to give you an idea of the overall percentage of your income that you pay in tax. The basic idea is that it's the tax divided by income, expressed as a percentage. But exactly what taxes are included and what income is included is not clearly defined. (You can find posts telling you how it's calculated but they don't all say the same thing.)


The blended tax rate has nothing to do with how your tax is calculated. It's an essentially meaningless number. You should ignore it.

 

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