The Partnership Income of $70,000 is considered active income from a non-passive activity. This income is subject to self-employment taxes consisting of Social Security Taxes of 12.4 % and Medicare Taxes of 2.9%, resulting in a combined tax rate of 15.3%.
Now, since your spouse has a W-2 income of around $50,000 and you are both filing a joint tax return and have no deductions other than standard deduction of $10,300 and personal exemptions $6,800 (3,400 x 2), your income along with the spousal income will result in a combined taxable income (W-2 income less exemptions and standard deduction) of approximately $102,900.
This results in your combined marginal income tax rate of 25%. The 25% tax bracket is a result of your taxable income exceeding the $63,700. As such only the income exceeding the $63,700 is taxed at the 25% bracket. In your case only $39,200 is taxed at 25% plus $8,772.50 (as the rest is taxed at lower bracket of of 10% and 15%).
Here is the detail of how I arrived at the calculation:
$0..........$15,650.............10% of the amount over $0
$15,650.........63,700......... .$1,565.00 plus 15% of the amount over 15,650
$63,700........128,500..........$8,772.50 plus 25% of the amount over 63,70
This explains why your CPA told you that your income may be subject to approximately 40% tax rate. (25% of regular tax plus 15.3% S/E tax).
However, you can now see it is not entirely true that your effective tax on LLC income is entirely taxed at 40% tax bracket. Some of your ncome could be considered to be in the 15% tax bracket as well if you consider the deductions allowable to your jointly filed tax return.