TurboTax is not calculating 0% LT Capital Gains for my total earnings of less than $40,000

[user17730382685]

I have a simple return but TurboTax is calculating a blended tax rate of over 16% for my total wages (<$10K) and total capital gains ($<30K). That is all the income I have (<$40K), there is no other income and my total capital gains came from 1 LT investment that was a gift, where I "inherited" the long-term cost basis from my parents providing the gift. I completed form 8615 ("Kiddie Tax") as I am a dependent (student).

In this scenario, I received and sold in 2025. Total market value of <$31K, total LT gain of about $27K, so total of earned and unearned income is about $37K. There is no other income.

This looks to clearly be an error in TurboTax applying the 15% LTCG rate.

I use the online version. How do I correct this or who do I talk with to fix?

[CatinaT1]

Are you still experiencing this problem?

[AmeliesUncle]

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@user17730382685 wrote:

I completed form 8615 ("Kiddie Tax") as I am a dependent (student).

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If you are subject to Form 8615, you are also subject to your parents' tax rate.  If their income is high enough that your combined income (your income plus their income) would be in the 22% tax bracket, then your long-term capital gains are correctly being taxed at 15%.