Tax question

[Hector]

Lets say, I had just two sources of income in the year 2010: Salary (W2) and interest income. In 1040, I entered W2 income in Line 7 and interest income in line 8a.
Line 22 is total on line 7 and line 8a.
Say I don’t have any deduction; my taxable income on line 43 would be total income (line 22) minus standard deduction (line 40) minus exemption (line 42)

To calculate tax, I use tax table for Taxable Income (line 43).

I think we pay 15% tax on interest rate. But by looking at this (above mentioned) calculation, I am adding all my incomes and using a standard table to calculate tax amount that I have to pay. Which means I am paying 25% tax in interest income if I fall into 25% tax bracket.

What am I missing?

[safari]

Interest income is taxed at the same rate as income earned from work. The 15% rate that you mention applies to long term investment income (i.e. capital gains) only.

[Hector]

Thank you

[GrimJack]

If you work 2 different jobs - Schedule M could sneak up and bite you as sched M is calculated for single income.

[MrPolarZero]

I think the payment option that you have presented actually looks OK. And since you have already made your mind about the car, I see no point in persuading you.
Well, come to think of it, you will actually find a lot of good uses for the nook. So you will still find this one a worthy purchase.
As far as I know, you can use the will left to you by your husband's friend as evidence of your claim. This will make getting a deed for the house much easier.
Yup, it would be better if you go through with the counseling first before settling money matters. The thing is, with your current situation, the problem will keep popping up again even if you have fixed it.
Wow! That one seems to be quite a complicated calculation. No wonder I am having some mistakes in my own returns calculations.