My liability is 3x the average? Really?

What is the name of your state?

IL

I'm finishing up my taxes on Turbo Tax and as I ran through their "comparison to national averages" tool I saw a really troubling statistic.
According to them, my tax liability was around $25,000 while the average in my bracket was just under $7,000! How can this be? I thought I was being pretty generous to myself with my deductions (I'm self-employed, work from home) but clearly I am missing something. Any ideas on what could explain this huge discrepancy?
Thanks in advance.

janeshmane said:

Any ideas on what could explain this huge discrepancy?

Click to expand...

Did you pay your quarterly estimated taxes??

Yep, I'm due a small refund.

Statistics are descriptions of a group and are can be used to make predictions. When you have an acutal case, you need the specific facts. Are you seriously asking how there can be a variation in tax liablity between all filers and you without providing your facts?

No, I just felt like complaining, that's all. How are people keeping their liability so low? Must be some very charitable folks out there.

Main guesses for the disparity of tax liability.

1. Most of the people in your tax bracket are near the bottom of the bracket.
2. Many high income individuals are entrepreneurs or business owners whose gross income is vastly different than net.
3. Many people are unlucky enough to have catastrophic health issues that will lower their tax burden.
4. Maybe you contribue less than average to your 401K.

Children and the number of children, have a huge impact as well.