TT has made an error in calculating my tax owed. Simple math. I owe about $200 more than TT says. What do I do?

[motor2]

Thank you, sir. I think that's the answer. I was just looking at taxable income and doing the math. Forgot about the different rates for those things you mentioned,

[SweetieJean]

Answered in comments.

[BMcCalpin]

Do you have capital gains or qualified dividends? They are taxed at a lower rate than ordinary income.

[BMcCalpin]

It is not obvious on the 1040, but the Tax on line 11 is not always calculated using the Tax Tables on the Taxable Income in line 10.

The most common case is when the Taxable Income on line 10 includes capital gains or qualified dividends. In this case, a separate worksheet is created that shows the ordinary income (less the capital gains and qualified dividends) taxed at the regular rates and capital gains/qualified dividends taxed at the lower capital gains rate. These two tax results are then added together and placed in line 11.

Thus, the Tax seen on line 11 will not appear to match a simple tax calculation on the whole Taxable Income amount in line 10.

[motor2]

Yes,,,that's it. I just saw the "taxable income" amount and computed the tax which was less than TT calculated, due to cap gains, etc. Good to know.

[BAJJERFAN]

My tax obligation  of $3950 on line 18 indicates a tax rate on my taxable income of 10%. My taxable income includes short term cap gains of $2650. The tax tables say my taxes should have been $4275. If STCG are taxed as ordinary income how does TT determine that my tax obligation is $324 less than what the tables say it should be? What is TT's obligation if the IRS determines that there is an error?

[NCperson]

it may not make a difference, but use Line 15....

and please confirm you have nothing on Line 3a....that is taxed at a lower rate, so it needs to be subtracted from Line 15 first.

if it saves you any effort, if TT was incorrect, these board would 'blow up' into 1000's of posts and that is not occurring

TT's obligation is that if they make a mistake in the amount of tax your owe, they will pay interest and penalties if the source of the error is the software... if you make a data entry error that causes the error, they will not be responsible for that.. Note they are not liable for the tax due in any circumstance, but will take responsibility for penalties and interest if the software made a calculation error and the data entry was correct.   

[BAJJERFAN]

There is $37 on 3a which is negligible IMO. I understand too that if there was an error in the TT software that the boards would be blowing up.  Still I do not understand how there can be such a large difference [$324] between what that tax table says is the tax on the amount on line 15 and what TT determines is the tax due on the amount on line 15; regardless of how one arrived at the amount on line 15.

[BAJJERFAN]

The IRS accepted the TT amount for tax due, but I expect that they would also have accepted the tax tables amount as well.  My understanding is that they don't get around to matching returns with W-2s or 1099s until some time this summer so per my old tax advisor  I'll just sit tight and and see what, if any, response they provide.

[NCperson]

just so we are on the same page;

Line 16 is from the tax table and it is looking up the amount on Line 15 LESS Line 3a and less whatever is on line 7 that is long term capital gains. 

also,  what is your filing status, are you looking in the correct column? 

if you want to post lines 1-15, I will review and explain what is occurring.  

[BAJJERFAN]

Married filing jointly.      line 7 is all STCG NO LTCG

line 8 is K-1 income from a trust.

Here is the info direct from the copy TT provided.

[NCperson]

please look on Schedule D, lines 7 and 15.... please reconfirm where that $2649 appears....I suspect it is on line 15 (long term), but you stated earlier in this thread that it was short-term (line 7)

[BAJJERFAN]

Here is your Sched D which put an entry into the LTCG section. I know that I had no LTCG. Also I believe that TT had access to both 1099-Bs.

Here is my sched D where I combined everything into the STCG section. I had never done TT using these forms before so I had no clue what to expect.

[BAJJERFAN]

The way I filled out my sched D is the same way that my tax advisor would have done it with his tax software had he efiled for me this year. Sp possibly the tax figured is correct for the way it was submitted, but I don't know why TT figured in LTCG.