which is considered qbi

Expert Solution

In Tax , QBI refers to Qualified Business Income Deduction . It is a maximum of 20 % deduction in taxable income if qualified for / eligible. The basic rules for qualifying are ( as of 2020):

1. Income is from : Sole proprietorships/ partnerships/Limited liability companies (LLCs)/Trusts / Estates

2. Income should be " Pass Through " , i.e , business income is reported in personal tax returns.

3. Income is less than or equal to $163,300 for single filers or $326,600 for joint filers.

4. Income is not from " specified trade or business " like doctor , actor etc . If total taxable income is above $213,300 if single, and $426,600 if married and filed jointly , then disqualified . However if income is within $163300 -$ 213300 for unmarried and $ 326600 - $ 426600 then there are other criterias to fulfill in order to avail partial deduction (< 20 %)

5 . Income is not from Capital Gains/Losses , Interest Income or dividends

jeff jeffy answered 2 years ago

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