TurboTax calculated an AGI of $34,350 and it is co...
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dayje723
New Member

TurboTax calculated an AGI of $34,350 and it is correct. However, it calculated zero Federal Tax due. Why did this happen?

 
4 Replies
AlanT222
Expert Alumni

TurboTax calculated an AGI of $34,350 and it is correct. However, it calculated zero Federal Tax due. Why did this happen?

This is possible if you have credits such as the Child Tax CreditEarned Income Tax Crediteducation credit, or any of the other many credits reported on Schedule 3 available to you.  

 

 

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dayje723
New Member

TurboTax calculated an AGI of $34,350 and it is correct. However, it calculated zero Federal Tax due. Why did this happen?

I reviewed my printed Federal and State Tax forms as well as my input into Turbo Tax.  I qualify for the standard deduction and I do not qualify for any of the credits you referenced (nor did I input data for credits or were forms printed out).  My income comes from a Partnership Schedule K and it appears that my income is computed correctly for Federal and State purposes.  

 

My Federal Return computes an AGI of $34,450 and no Federal Income Tax due.  However, my State Return uses my Federal data and appears to calculate a state tax obligation.

 

What am I doing wrong?

dayje723
New Member

TurboTax calculated an AGI of $34,350 and it is correct. However, it calculated zero Federal Tax due. Why did this happen?

Think I figured it out .... it is the composition of my income that drives the answer.

 

MY AGI was $46,865.  Of this, $38,555 was Long-term Capital Gains.  I believe my income level falls below threshold for taxing my Long-term Capital Gains.  They are then excluded from the tax calculation.

 

What is confusing is that Form 1040 Shows my taxable income as $34,470.  Yet, it would appear that the number used to compute my tax due is much lower that that after adjusting out the Long-term Capital Gains.

 

Can you confirm my thoughts as to what has happened?

JohnB5677
Expert Alumni

TurboTax calculated an AGI of $34,350 and it is correct. However, it calculated zero Federal Tax due. Why did this happen?

Yes that is correct.  There is a worksheet called the Qualified Dividend and Capital Gain Worksheet  (Qual Div/Cap Gn) that provides the calculation.  It does not show clearly on the 1040.

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