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Level 1
July 9, 2020

why a clients taxes would increase by $21,000 if his taxable income only increased by $18000

  • July 9, 2020
  • 2 replies
  • 13 views

In 2018 my client's adjusted gross income was $211,755, his taxable income was $190,619 and his taxes for that year where $25,923.

In 2019 the same client's adjusted gross income was $229,823, his taxable was $207,929 and his taxes are $47,130 a $21,250 increase over 2018.

I need to know what cause the difference.

Thanks

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    2 replies

    Level 15
    July 9, 2020

    Look at the 1040 and the numbered Schedules and compare the two years.  Most likely some credit changed substantially or the higher year had more Self Employment income.

    Just-Lisa-Now-
    Intuit Community Champion
    July 9, 2020

    A large chunk of long term capital gains in 2018?

    Its just a guessing game from here, you need to compare both returns side by side and see where the difference is.

    ♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪