Mom sold home in 2018 for a cap gain of ~$330k of which $250k is exempt. Income is < $30k incl SSA, so should be 0 cap gain tax, but TTax says owes ~9k. Why?

[TaxGuyBill · Accepted solution]

She doesn't have $30,000 of income, she has $110,000 of income (including the taxable $80,000 of capital gains).

Depending on how much Social Security she has (only part of it would be taxable) , if she files as Single and takes the Standard Deduction, that leaves roughly $95,000 of "taxable income".  That puts about $55,000 of that capital gain income in the 15% tax bracket.

So between the 'regular' tax on her other income and the 15% tax on the roughly $55,000 of capital gain, yes, about $9000 in Federal tax is probably correct.

[VolvoGirl]

Up to 85% of Social Security becomes taxable when all your other income plus 1/2 your social security, reaches:
Married Filing Jointly: $32,000
Single or head of household: $25,000
Married Filing Separately: 0

To see the Social Security Benefits Calculation Worksheet  in Turbo Tax Online version you would have to save your return with all the worksheets to your computer.  Or if you are using the Desktop program you can switch to Forms Mode (click Forms in the upper right) and click on SS in the list on the left side.