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When you enter an investment sale, you can't go by changes in the refund monitor to tell what tax is charged on that transaction. The addition of income adds to your adjusted gross Income which changes many other things on your tax return. To see what else is changing, you would have to print the 1040 before adding this income and then after, and compare then side by side to see the differences.
I noticed this problem also with Turbotax Deluxe. Federal tax due went significantly higher after adding the capital gains. It should only go up by an amount equivalent to 15% of the capital gains. Can someone from TurboTax help? Been struggling with the software which seems to be getting worse every year. Thank you.
It sounds like the capital gain is large enough that either the capital gains tax rate is higher, or it caused the loss of other deductions and credits.
A review of your Form 1040 may help to clarify what is going on. To review it follow these steps:
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