Total tax calculation error

[three60four]

I've spoken with support on this and they recommend I buy an upgrade so I can speak with a tax specialist on this issue. I believe my desktop 2023 Turbo Tax Deluxe desktop software is making a calculation error of my tax due on Form 1040-SR. Details are as follows:

Filing Status: MFJ

Standard Deduction: 1 age 65

Line 9: $119,136.00 Total Income (correct calculation)

Line 12: $29,200.00 Standard Deduction (correct calculation)

Line 15: $89,936.00 Taxable Income (correct calculation)

Line 16: $10,214.00 Tax (calculation error)

Line 33: $10,632.00 Total Payments (correct calculation)

Line 34: $418.00 Refund (correct calculation based on Line 16, which is incorrect)

Based on the IRS 2023 Instruction booklet Tax Table on page 75, the Tax on $89,936.00 for Status MFJ should be $10,399.00, not $10,214.00. So, Turbo Tax is calculating a $185.00 greater refund than it should be. Refund should only be $233.00.

I don't believe I need to speak with a tax specialist.

[rjs · Accepted solution]

The tax table is only one of seven different methods that can be used to calculate your tax, depending on what is in your tax return. Your tax return must require one of the other methods. The most common reason that you cannot use the tax table is that your income includes qualified dividends or long-term capital gains, which are taxed at lower rates.

In the IRS Instructions for Form 1040 and 1040-SR, look at the instructions for line 16. Starting in the right column on page 33 it explains the conditions for determining which of the 7 methods to use to calculate the tax.

Since you are using the CD/Download TurboTax software you can see which method TurboTax used by looking at the 7 checkboxes in the Tax Smart Worksheet. You can see the Tax Smart Worksheet in forms mode. It's between lines 15 and 16 in the first section of the Form 1040 or Form 1040-SR Worksheet.

[three60four]

I had a $2,000.00 qualified dividend. I found the worksheet showing the calculation method used for the Tax due. Makes total sense now.

Thanks for the help!