Tax due per TurboTax vs IRS tax schedules

[HuiM1hear]

THIS QUESTION IS FOR THE TURBOTAX PROFESSIONALS, NOT FELLOW USERS

Questions re TurboTax calculations on our program: TurboTax Home and Business

Our total income is shown as $142,610.

Our Federal Deductions are shown as $62,865.

Our Taxable Income is shown as $67,120.

Our Federal Taxes owed is shown as $18,798.

18,798 divided by 67,120 shows our tax rate to be 28%.

taxfoundation.org (and IRS.gov) lists federal tax rates for joint filers like us as:

10% on first 19,750 = 1,975.

12% on 19,751 to 80,250 (to 67,120 for us)  = 12% of 47,369 = $5,684.28

       1,975.00

+     5,684.28

$     7,659.28

NOT $18,798 !!

HOW DOES TURBOTAX EXPLAIN THIS DISCREPANCY ?!?

[Opus 17]

Do you have schedule C self-employment income?

If you are using Home & Business installed on your own computer, you can click on "Forms" to switch to forms mode, and review or print each form and worksheet to see where the calculations come from.  No one on this board, user or employee, can see your return to give you an exact answer.

[BillM223 · Accepted solution]

You described how to calculate the federal income tax - line 16 on the 1040.

However, there can be other taxes on your return, such as line 17 (1040) from Schedule 2, and line 23 (1040), also from Schedule 2.

A very common situation is that the taxpayer is successfully self-employed, but owes not only federal income tax but also self-employment taxes, which are roughly 15.3% of the next profit of the business. This can cause the tax due to be more than twice what the taxpayer would owe if this were just W-2 wages.

Please look at lines 16 to 24 on the 1040 and see if there is a number there that you do not understand.

[fanfare]

Always print a copy of your completed tax return for your records, and review it carefully before e-Filing.
You will need it if you are audited by the IRS, or to amend if a TurboTax update changes your return or for any other reason,

AND, to find your AGI next year.

[HuiM1hear]

I need to channel my inner Treebeard, and not be "hasty".

I only looked at the summary, and had not yet reviewed my forms before freaking out at the apparent (yet clearly appropriate upon further review) "discrepancy".