Quote Quoting KBoy420
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Thanks Taxing Matters. I understand all the variables that can affect taxable income and plan to have this all looked over by a CPA. Are you able to direct me to 2014 Form 1040 tax tables? I have searched for hours and can only locate the 2015. Thinking back, I'm wondering if my return from last year is wrong. Based on the 2015 tax table, with the taxable income that we have, the tax liability is close to $12,000. Last year, with practically the same taxable income (less $1,500), our tax liability was only $8,500. I cannot find the 2014 tax tables to verify the taxable income of $63,400. Did federal taxes increase from 2014 to 2015?
To expand on what Taxing Matters said:

Your wife had three W2s. Each one of those jobs withheld taxes based as if each of those jobs was her only income for the time period she was working. If she had any of those jobs at the same time, that automatically made her withholding too low. On top of that she had 1099-MISC income which likely resulted in some self employment tax, and no withholding. Then there was the third party sick pay with no withholding either.

You, on the other hand, had the more stable income yet you took 2 exemptions, which means that your withholding was more designed for break even than a refund. So there was nothing left over in your withholding to help cover your wife's insufficient withholding, and your child was not enough of an added benefit to overcome that.

Rather than comparing this year's income with last year's income, you should compare this year's total withholding to last year's total withholding...relative to total income. I think that you will find that relatively speaking you had much less withholding this year.

As far as finding last year's tax tables, go to irs.gov and search for 2014 1040 instructions.