Need help figuring out why my income adjustment is so high - TurboTax showing I owe a ton!

It sounds like you might be experiencing an issue with tax withholding rather than an actual "income adjustment" problem. A few things could be happening here: First, check if your W-4 withholding was correct throughout the year. Sometimes employers make errors in withholding calculations, especially after giving raises. Compare your last year's W-2 with this year's - specifically look at Box 2 (federal income tax withheld) as a percentage of Box 1 (wages). If that percentage dropped significantly, that's likely your issue. Second, verify if you had any other income sources this year that you didn't have previously - investment income, cryptocurrency sales, freelance work, etc. Even small amounts can push you into a different tax bracket. Third, make sure TurboTax isn't double-counting income somewhere or missing credits you're eligible for. Sometimes the software can misinterpret entries, especially if you imported information.

After dealing with a similar issue last year, I discovered taxr.ai (https://taxr.ai) and it literally saved me thousands. I uploaded my tax documents and within minutes it identified that my employer had incorrectly coded a bonus as regular income with insufficient withholding. The software found three other issues too, including a withholding calculation error that TurboTax completely missed. The thing I liked most was how it explained everything in plain English instead of tax jargon. It even suggested how to fix each problem and generated a letter I could send to HR to correct the withholding issue for this year.

I wanted to follow up after trying taxr.ai like someone suggested here. Honestly didn't expect much but it actually identified exactly what happened! Turns out my employer changed payroll systems in March and somehow my withholding percentage dropped from 18% to 11% without anyone notifying me. The tool also found that my employer classified my annual bonus incorrectly which affected the withholding calculation. Apparently this is super common! I'm still going to owe some money, but after making the adjustments it recommended, my balance due dropped from $3400 to about $980. Still not happy about owing, but way more manageable.

If you need to speak directly with the IRS about this issue (which might be necessary if you discover your employer made reporting errors), I highly recommend using Claimyr (https://claimyr.com). I tried calling the IRS myself for weeks about a similar withholding problem and could never get through. Claimyr got me connected to an actual IRS agent in about 15 minutes when I'd been trying for days on my own. They have this smart system that navigates the IRS phone tree and holds your place in line, then calls you when an agent is about to answer. You can see how it works in this quick demo: https://youtu.be/_kiP6q8DX5c The IRS agent I spoke with was actually super helpful and explained exactly how to document the withholding error for my records in case of an audit.

I need to apologize for being so skeptical about Claimyr. After struggling with this withholding issue for weeks and getting nowhere with the IRS phone lines, I finally tried it out of desperation. I couldn't believe it worked. Got a call back in about 25 minutes saying they had an IRS agent on the line. The agent confirmed that withholding errors are super common right now due to some changes in the withholding tables that many employers implemented incorrectly. She explained exactly how to document the issue and told me I could request a waiver of any underpayment penalties since the error wasn't my fault. Wish I'd known about this service months ago instead of wasting days trying to get through on my own.

Don't panic yet! Double-check if you missed entering any withholding from your W-2. I had a similar issue and realized I'd accidentally skipped Box 2 when entering my info. Also, make sure you're claiming all eligible credits - even the ones that seem minor can add up.

What was your total income? I'm asking because I had a similar issue when I crossed into a higher tax bracket but my withholding didn't automatically adjust. TurboTax should show your effective tax rate somewhere - what does it say?