Why is the tax rate wrong?

[taxmoabman]

Turbo Tax has calculated line 43 to be 30,794. It has created a tax on line 44 of 3,501. The tax table show a tax of 3,689. Why is there a difference? This is for married filing joint.

[AnthonyC · Accepted solution]

Tax liability can be calculated a variety of ways and using strictly the tax table is not always the appropriate method.  Since your tax is less than the tax table, you likely have Qualified Dividends or Capital Gains.  Those types of income are taxed at lower tax rates and thus you use a different calculation method for tax liability.  There are other types of income/situations that require different calculations or additional taxes such as self employment taxes.  

Since it shows you are using the desktop program, you can actually switch to the Forms Mode and look at page 2 of your 1040.  There should be a box checked under the tax liability that shows you the method of tax calculation.    

[taxmoabman]

Thanks for your help, greatly appreciated.