[REG] 199A QBI deduction(Flow-through Business Entities: Part 1)

C corp > flat & lower tax rate	Flow-through entities - S corp - Partnerships - Limited liability companies - Trusts
	Specified Service trade or business FTE dealing with: - health, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, etc...	Qualified Trade or Business Any business other than an SSTB

 

 

Qualified business income deduction (section 199A)

- Deduction taken "below the line" or from AGI

 

- Deduction given to the business owners(individuals)

- Deduction of 20% of QBI for eligible " flow-through" US entities

- Limitations to the two QBI deductions, greater of 

50% * W-2 wages for the biz

25% * W-2 wages for biz + 2.5% *UBIA of all qualified property

 

 

sorted by taxable income	Single	MFG	Limitation
Category 1 Under threshold	≤191,950	≤383,900	lessor of 20% * QBI / (taxable income-net capital gain) * 20%   * SSTB, QTB same   * w2 and property limitation not apply
Category 2 Over threshold	≥241,950	≥483,900	QTB: Full W2 and property limitation apply SSTB: No QBI deduction
Category 3 Bet threshold	bet	bet	not tested in exam