Finally found a willing CPA to consult and my tax bill went from 27.9% down to 10.8%. Sure it ended up costing me $300, but I saved nearly $10k.
The CPA stated unequivocally that having used TurboTax herself, it can make many errors - she does not trust it. I don't know about you, but I don't dabble in tax law as a hobby, so all I knew was 27.9% was insane at the bracket I'd wrestled myself into. While she found the offending line item, I researched what had gone so horribly wrong:
W2 Box 12(b) appears as line item 60(c) under Other Taxes, with the code "UT" which is Uncollected Social Security & Medicare Tax on Tips or Group Term Life Insurance. This TOTAL AMOUNT WAS ADDED to my tax bill. Not only was the amount supposed to only be 6.65% of the amount, it was only applicable if reported as codes "A-B,M-N." Mine was listed as code, "D" which is Elective deferrals to a section 401(k) cash or deferred arrangement, which isn't even applicable.
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I tried to get an appointment with a CPA to explain the results of my taxes with me (done in Turbo Tax), but the ones which will let me hire them without having prepared my taxes themselves won't see me until after the 15th.
Here's my concern:
My Gross Adjusted Income puts me below the 28% tax bracket, and my Taxable Income is 30% less than the Gross Adjusted, which means - if my tax is truly being levied against Taxable Income - I'm paying an insane 27.9% which is nearly double the bracket I was able to get myself into.
What am I missing?
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