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Returning Member
posted Apr 13, 2022 11:24:01 AM

Using Turbotax Home & Business 2021effective tax rate does not seem correct

I have been unable to come up with the Effective Tax Rate that is shown on the fist page of my tax return form. I have read other responses to Effective Tax Rate questions stating that it is calculated using Total Tax (Line 24) divided by Total Income (Line 9) and the result for me would be 11.9%. I made estimated tax payments during 2021 but have a balance due. If I divide Balance Due (Line 37) by Total Income (Line 9) the result is 2.11%. Balance Due is not my Total Taxes Paid but I'm trying to come up with the Effective Tax Rate that Turbotax lists on my form which is 2.17%.

How is this calculated?

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1 Replies
Expert Alumni
Apr 13, 2022 12:48:53 PM

Your “effective tax rate” is the average percentage of your taxable income that you owe in federal taxes. In order to calculate this rate, you simply divide your tax liability (what you owe) by your total taxable income.