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The federal tax that turbotax calculated is higher than using tax bracket

Would anyone know why Turbotax calculated my federal tax higher than using the tax bracket?

 

I used the taxable income that TurboTax give to manually calculated, it's different. 

 

Thanks,

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2 Replies
rjs
Level 15
Level 15

The federal tax that turbotax calculated is higher than using tax bracket

Did you claim the foreign earned income exclusion? If so, you have to use the Foreign Earned Income Tax Worksheet to calculate your tax. You can't just calculate it using the taxable income on Form 1040 line 15. The amount of excluded foreign income affects the tax because your other income, that is not excluded, is taxed at the same rates that would have applied to that income if you did not get the exclusion. The non-excluded income is "stacked" on top of the excluded income for the purpose of calculating the tax. Therefore, when the amount of excluded foreign income increases, some of the other income gets pushed into a higher tax bracket, and is taxed at a higher percentage. The Foreign Earned Income Tax Worksheet does all the necessary calculations.


If there is an amount on Schedule 1 line 8d you are claiming the foreign earned income exclusion.

 

MayaD
Expert Alumni

The federal tax that turbotax calculated is higher than using tax bracket

The federal income tax system is progressive, which means that tax rates go up the greater taxable income you have. The term "tax bracket" refers to the income ranges with differing tax rates applied to each range. When figuring out what tax bracket you’re in, you look at the highest tax rate applied to the top portion of your taxable income for your filing status.

For more information and to check how do Tax brackets work check: What is My Tax Bracket?

 

You might be paying additional taxes (calculated on schedule 2) like self employment Tax.

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