Why is the income tax lower than expected?

[epaclubtax]

I  m doing my federal income tax.  My taxable income after all deductions is $28,828.  Married filing jointly.

According to my hand calculation: Tax = $20550x10%+(28828-20550)x12%=$3048.36

I print out turbos tax return, it gives me $2,970.   Why tax from turbotax is NOT $3048.?

Is turbo tax wrong?  Help!

[AnnetteB6 · Accepted solution]

No, TurboTax is probably not wrong.  

Since TurboTax is calculating your tax amount lower than the tax tables, your income tax is most likely being calculated on the Qualified Dividends and Capital Gains Worksheet.  When this worksheet is used to calculate income tax, your income is broken down into certain categories.  Long-term capital gains and qualified dividends are separated from other income and taxed at lower rates.

Going through that worksheet one line at a time would show how the total tax was calculated.

If you are using one of the CD/downloaded versions of TurboTax, you can find the worksheet by going to Forms Mode.  Click Forms in the upper right corner of the screen.  Then, look for Qual Div/Cap Gn in the list on the left side of the screen.

If you are using TurboTax Online, you will need to pay for your return and then print or preview the return to find the worksheet.

[SteamTrain · Accepted solution]

Well hand calculations can go wrong...but even the tax tables might show a higher tax. 

(i.e. $3042 for MFJ, & only if  ALL of it is from "ordinary income")

BUT

While Capital Gains, and Qualified dividends are included in your 28,828 total,  the actual taxes on those starts at zero...so a special tax calculation sheet is used to break out those particular $$...usually the Qualified Dividends & Capital Gain Tax worksheet is used.