how to calculate income from tax returns (1040)

bthahir · Joined: 05 Sep 2007 Posts: 36 13.22 Dollars($)

I need to know how to calculate income from tax returns

ckalvesmaki · Posted: Mon Sep 17, 2007 12:23 pm Post subject:

If you're self employed it's based on the schedule C......net income adding back in depreciation.......If you are a w-2 wage earner it's based on your gross earnings and not the 1040

larry · Joined: 27 Jun 2007 Posts: 3328 473.40 Dollars($)

Hi Bthair,

To calculate the income from your tax return, you may refer to a calculator at : "http://www.dinkytown.net/java/Tax1040.html"

helping_user

Hi Bthahir,

In order to know your income after paying off the tax, follow the steps mentioned below:-

First of all you need to figure out your gross income from various sources like wages, salary, taxable interest, alimony received, taxable IRA distributions, taxable pensions and annuities, taxable social security benefits etc.
Calculate the adjusted gross income after deducting the adjustments allowed by the IRS like educator expenses, the IRA deductions, student loan interest deduction etc.
From the adjusted gross income, subtract the following to determine your taxable income.

1. Either the standard or the itemized deductions (IRA contributions, charitable contributions, mortgage interest, large medical expenses etc.) according to your filing status.

2. Personal exemption ($3,400 in 2007 for each person financially dependent on you).
You get to know the amount of tax (tax returns) you pay by multiplying your taxable income with the tax bracket under which you fall. To know your tax bracket refer to http://www.irs.gov/formspubs/article/0,,id=164272,00.html
Your net income is there with you after deducting the tax returns from your taxable income.

Thanks.

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