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Author: 0x6a74 Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121341  
Subject: <Rant> Date: 4/10/2012 1:20 AM
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i now agree taxes are Just Too Complicated (>;


sent in my tax returns yesterday and then wanted to calculate marginal rate .. (just for grins)
so i googled "tax table" and got one of those : 0% for such and so $$, 15% for so and whatever, etc ... and calculated my total tax to be something far above what TurboTax said i owed.

'tax' goes on line44 of 1040, instructions for which say, SEE instructions for 1040 line 44...
( 1040 instructions are 189 pages!! )

where it says something like:
if taxable income less than 100k, use tax tables, UNLESS
you have a schedule D where line 18 or 19 greater than zero --use 'Schedule D Tax Worksheet'

or you have qualified dividends (line 9b) or
no schedule D, but capital gains on line 13
OR Schedule D with lines 15 and 16 greater than aero
..i which case, use 'Qualified Dividends and Capital Gains Tax Worksheet'

i fall into the last group (need to use QDaCGTW)
* Schedule D with lines 18 and 19 = 0
* qualified dividends on line 9b (of 1040)
* schedule D lines 15 and 16 greater than zero

the QDaCGTW computes tax using Tax tables and some bizarre function of taxable income and capital gains -- best as i can figure, cap gains and other income taxed separately --meaning different marginal rate (bracket) for each, and a lower marginal than if taxed as one (in my case, cap gains about 60% of total income)

and since the amount of non-SS income determines how much of SS is taxable --it's a big mess ...
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