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My blended tax rate on $144K taxable income filing married, jointly is 20.8%. My rate based on your tax schedules is much less. How do I get the correct calculation?

This information is from "Your tax summary" document. Based on the tax tables my blended rate should only be 15.13%
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JohnW152
Employee Tax Expert

My blended tax rate on $144K taxable income filing married, jointly is 20.8%. My rate based on your tax schedules is much less. How do I get the correct calculation?

The numbers from the tax schedules assume all of your income is taxed at the same rate.  There are certain types of income -- self-employment income and early distributions of pensions and annuities come quickly to mind -- that will add additional taxes, on top of income you're already being taxed on.  This may be what you're seeing, but without knowing what types of income you received, it's not possible to speculate.

 

Your blended tax rate is computed based on a number of factors. Your tax rate is the average rate of taxation for items such as earned income like wages and unearned income like dividends. 

 

But if you received other types of income -- capital gains, for example -- this can cause your blended tax rate to vary.  Capital gains are generally taxed at lower rates than other types of income.  On the other end of the spectrum, the addition of self-employment tax will increase your blended rate. 

 

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