How did TurboTax 2018 calculate a tax on a line 10 amount ? Using 1040 instructions myself, I get a number at least 3k more ?

[bfsrstsk]

I've used TurboTax Premier before, and confident it was correct filed my return electronically. Today, I had reason to go back and look at the form 8949's TTx generated and also noticed the tax it calculated on the line 10 amount  seemed low. I looked up the tax on the line 10 amount TTx figured using the 1040 instructions myself and found it should be at least three thousand dollars more. How did TTx come up with the tax it is reporting I owe, and if this is incorrect (for some reason), how can I file an amended return if TTx is not calculating the tax correctly ?

[rjs · Accepted solution]

You probably didn't use the correct method for calculating the tax. There are seven different methods that can be used to calculate the tax on Form 1040 line 11a, depending on what types of income you have and other things in your tax return. The IRS instructions for Form 1040 line 11a, starting in the middle column on page 38, explain the conditions for using each of the 7 methods.

The Tax Smart Worksheet in TurboTax has 7 checkboxes that show you which method TurboTax used. Since you are using the CD/download TurboTax software, you can see the Tax Smart Worksheet in forms mode. It's between lines 10 and 11 of the Form 1040 Worksheet.

[idjit]

I have the same issue using the online version.  The software automatically calculates the tax owed based on all your input, so your answer about not using the correct method does not answer the question because there is no choice.

[Critter]

The program always chooses the method that gives you the lowest legal tax liability UNLESS you override that choice in the FORMS mode in the downloaded program. The original poster what calculating the tax using the tax tables manually and did not use the QDCGTW like the program does.

Since the ONLINE version is currently in transition from the 2018 to 2019 version I am not sure how you could be using it at this time. So to review the method chosen by the program you will need to review the worksheet ... save a PDF of the return WITH all the worksheets when the Online program goes live again sometime in December.

[idjit]

I am trying to amend my 2018 tax return because I received a corrected 1099 composite form after I filed and am using the PDF with all the worksheets that I printed when I filed initially as reference.  When I look at the taxable income amount on the original 2018 return, the tax calculated by TurboTax is just under $3000 less than doing the calculation manually.  My QDCGTW numbers are correct.

[BillT1]

1040X  line 1b greater that actual div and int amounts added.