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Filing 2019 late. Why do I have $0 taxes on $19000 in taxable income?

I'm (finally) doing my 2019 taxes. I have approximately $19,000 in 2019 taxable income. 0 taxes makes me a little nervous and I have been unable to figure out why/how TTax determined that I owe $0 in taxes.

The approximate breakdown is

Pension $1,500

CapGains $28,500

Div and Int  $13,000

Standard Deduction $24,000

Leaving $19,000 taxable.

I have some 'maybe' answers but was hoping The Community' has the answer.

Thank you!

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3 Replies

Filing 2019 late. Why do I have $0 taxes on $19000 in taxable income?

This is curious, but you only told the income part of the story.  Now, Please tell the tax, plus the withholding and credit part of the story.

Look at your form 1040 to find this info.  To do this

Click the "Forms" icon in the blue bar at the top right of your screen.
From the list of forms, click the form you want to review.
Review as many forms as needed.
Hint: You can also review your state(s) forms here.
To return to the step-by-step process, click the "step-by-step" which is in the blue bar at the top right of your screen, where the "Forms" icon formerly was located.

 

IF you want to check the tax calculation, the 2019 tax tables are available here:

https://www.irs.gov/pub/irs-prior/i1040gi--2019.pdf

 

If you entered your data correctly, I'm guessing this will answer your question.

If not, recheck all data entered for your forms.

 

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Filing 2019 late. Why do I have $0 taxes on $19000 in taxable income?

Since you made less than $44000 (approximate, don't remember exact dollar cutoff), your long term capital gains are taxes at a rate of 0%. 

DawnC
Employee Tax Expert

Filing 2019 late. Why do I have $0 taxes on $19000 in taxable income?

Easiest thing to do is to look at your printed copy of Form 1040 before you file.   Long term capital gains have a lower or $0 tax rate, so it is possible you have net $0 tax.   You have a 1040/1040SR Wks included in your return that will detail your tax calculation for you.   

 

The tax computation is on the Tax Smart Worksheet that is located between Line 15 and Line 16.   If A1 is checked, your tax liability came from the tax tables.   But if any other line has a checkmark, you will have to go to the corresponding worksheet to see the tax calculation.   

 

Some income is taxed at different rates (Qualified Dividends/Long-Term Capital Gains are taxed at a lower rate than ordinary income).    You have one of the worksheets marked on your Form 1040/1040SR Wks.

 

 

tax smart worksheet.jpg

 

In this example, the taxpayer has to view the Qualified Dividends and Capital Gain Tax Worksheet to see how their tax was calculated.   

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