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

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Level 1
last updated ‎July 09, 2020 5:45 PM

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 2
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Level 12
last updated ‎July 09, 2020 5:45 PM

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.

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Level 15
Level 15
last updated ‎July 09, 2020 5:45 PM

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.


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