Why is TT taxing 1099-int at 39%?

[kenc295]

As I'm entering my 1099-int statements from banks etc, I notice that my Fed "refund counter" is going down at a 39% rate. When the top rate is 37% and I am in the 35% bracket, how is that possible?

[JamesG1]

Is this a dependent tax return?  Is the dependent filing form 8615?

Does adding this income throw your taxable income over the filing requirement for your filing status?

Does the 1099-Int report only box 1 information or is information reported in other boxes on the form?

[kenc295]

1099s are all box 1. It's my personal return.  I wonder if it's the influence of 8959 and 8960 which appear to have been triggered.

[ReginaM]

Yes, both Form 8959 and Form 8960 can affect your taxes.  Keep in mind while you are entering your data, that the Refund Meter at the top of your screen is an estimate only, and will continually change until you have entered all of your data.  

[NCperson · Accepted solution]

that interest is also taxed by the 3.8% Investment tax, so as you add $1 of interest, the marginal tax impact is 35%+ 3.8% or 39% 

[kenc295]

Thank you all.

so much for the "top rate" being 37%......sigh.......