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When I compare my taxable income in the 1040 Instruction booklet 2023 Tax Table with TurboTax, the TurboTax liability is 30% higher. Can you help me understand why?

Blended Tax rate listed is 13.9%, but this does not appear to correlate and so may not be important.
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6 Replies
JulieS
Expert Alumni

When I compare my taxable income in the 1040 Instruction booklet 2023 Tax Table with TurboTax, the TurboTax liability is 30% higher. Can you help me understand why?

We'd love to help you complete your tax return, but need more information. Can you please clarify your question?

 

If the tax is higher than what is listed in the tax table, then you must be subject to AMT, additional taxes, or an alternate calculation. 

 

For example working a "side gig" where you get a 1099-NEC will increase you taxes as compared to making the same amount and getting a W-2 form. 

 

Please respond back with details of what kind of income you have and if there's anything unusual about your tax situation. 

 

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When I compare my taxable income in the 1040 Instruction booklet 2023 Tax Table with TurboTax, the TurboTax liability is 30% higher. Can you help me understand why?

I am a high school student who had a summer job, my wages and tips combine to be $1212 through the whole summer. I received a 1099INT from investment income that came out to be $924. My total taxable income was $524. That is it I had no other income and came no where close to qualifying for AMT.

JulieS
Expert Alumni

When I compare my taxable income in the 1040 Instruction booklet 2023 Tax Table with TurboTax, the TurboTax liability is 30% higher. Can you help me understand why?

Yes, you are right about that. Your tax should be $51, which is exactly what I got in TurboTax and exactly what the 1040 booklet says. 

 

The only reason I can think of that the amount would be higher is if there are allocated tips on your W-2 form. 

 

Check box 8 of your W-2 form. Any amount there would mean that your employer claims you received tips that you didn't claim. If that's the case you would be charged Social Security and Medicare taxes on those tips. 

 

Check line 5 of Schedule 2 to see if there is extra tax there. 

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When I compare my taxable income in the 1040 Instruction booklet 2023 Tax Table with TurboTax, the TurboTax liability is 30% higher. Can you help me understand why?

I checked my W2 - no tips claimed there.  I think the weirdest thing is that I agree with the amount of taxable income (~$500), but the $73 that TurboTax is telling me I owe $73 which is not listed as a potential tax liability in the 2023  Tax Table.  I don't have a schedule2 - there was nothing on that form that applies to me. How do I write to TurboTax to get resolution?  

When I compare my taxable income in the 1040 Instruction booklet 2023 Tax Table with TurboTax, the TurboTax liability is 30% higher. Can you help me understand why?

The $51 tax should be on 1040 line 16.  Then see if there is anything on lines 17-23.  Is line 24 the same as 16?

When I compare my taxable income in the 1040 Instruction booklet 2023 Tax Table with TurboTax, the TurboTax liability is 30% higher. Can you help me understand why?

You might owe the kiddie tax on the investment income.  I don't know anything about that.

 

How to pay the kiddie tax

https://ttlc.intuit.com/community/my-tax-return/help/how-do-i-report-and-pay-the-kiddie-tax/00/26055

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