How do you figure taxable income from your Adjusteed Income,when you do your tax returns?

My taxable income was $23,409 Less than my Adjusted Gross Income. There was $10,460 For total tax and credits. My question is how do I find out where the $12,949, that was taken from the Adjusted Gross Income? Does this have something to do with the taxes I payed on my mortgage loan on my house?

Public Comments

1. The difference between Adjusted Groos, and Taxable Income, is your personal exemptions and either standard or itemized deductions.
2. The difference between your adjusted gross income and your taxable income would be the total of your itemized deductions and personal exemptions. Your itemized deductions are the total of your state and local taxes, mortgage interest, real estate taxes, charitable contributions, and many other expenses you paid during 2008 that are allowed to be deducted. If your itemized deductions total more than the standard deduction for your filing status, you are able to deduct the higher itemized amount. Then your personal exemptions would be $3500 times the number of exemptions you are claiming on your income tax return. This would be one for you, or one each for you and your spouse, and one for each dependent you are claiming on your return. So if you add your itemized deductions with the total of your personal exemptions, you should be able to account for this difference. Laura H – H&R Block – Senior Tax Advisor 5 **This advice was prepared based on our understanding of the tax law in effect at the time it was written as it applies to the facts that you provided.
3. After your AGI, several additional deductions from Sch. A(Medical & Dental Deductions [in excess of 7.5% of AGI], Taxes u paid (State, Property and Sales], & Personal Residence Mortgage Interest [if you own and have paid mortgage interest during the tax-year], Charity Contributions) and some miscellaneous dductions [see instructions] flow to reduce AGI to Taxable income wherefrom u can calculate ur tax depending upon the 'filing status and dependents'. That's why ur taxable income is more by $23,409 (u will probably see this amount on last line of your Sch.A) than AGI. $10,460 is the amount of tax and credits u have paid/witheld with IRS for the year and DOES NOT have anything to do with the AGI or Taxable income. This will be used to indicate ONLY if u owe more taxes (underpaid) or IRS owes u a refund (u overpaid). U can go 'www.turbotax.com' or 'www,taxact.com' or 'taxcut.com' amongst many other 'free tax' services to do your taxes for free. U only pay when you file or print, otherwise it calculates free! Good luck!!