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jw007
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Turbo Tax Calculating Incorrect Tax Rate On Capital Gains (Over 60%!) - Please help

Hello,

Turbo Tax Home & Business is calculating a short term capital gain rate of over 60% which is wrong (the max it can ever be is 37%.

Quick math: $60,756 due before inputing transaction, after inputting $1,000 short term capital gain, my new amount due is $61,376 which is $620 increase on $1,000 which equates to 62% tax rate.

This is wrong, even if I am in the highest tax bracket, the most a short term cap gain can be is 37%.

How do I fix this? I have added screenshots.

Screen Shot 2022-04-17 at 1.51.46 AM.pngScreen Shot 2022-04-17 at 1.50.03 AM.pngScreen Shot 2022-04-17 at 1.49.56 AM.png

 

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2 Replies

Turbo Tax Calculating Incorrect Tax Rate On Capital Gains (Over 60%!) - Please help

@jw007 

 

Must be losing it somewhere else.

 

Print out your tax return, both before, and after the added income.

 

1) Check the change in the underpayment penalty at line 38 of your form 1040.

2) Check any changes in the other taxes on Schedule 2, (and line 12 of schedule 2 in particular)...but could be some other tax changes too.

3) Look at lines 16-thru-24 of the form 1040  (before and after) to see if the extra tax is coming in on some other line, and investigate it there.

 

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*

Turbo Tax Calculating Incorrect Tax Rate On Capital Gains (Over 60%!) - Please help

You might be subject to the Net Investment Income Tax.  Also, any increase in income can lower or eliminate some deductions/credits.

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