2. Which is NOT true of the QBI-Qualified Business Income Deduction? Caution: read all answers before...

2. Which is NOT true of the QBI-Qualified Business Income Deduction? Caution: read all answers before you choose.

a. The QBI is 20%

b. The QBI doesn't reduce self-employment tax

c. The QBI doesn't reduce adjusted gross income

d. If married people, make more than $315,000 or single people make more than $157,500 there are many limitations on this deduction

e. The QBI can be used for sole proprietorships (schedule C), partnerships, or Sub S corporations.

f. All of the following are true.

Solutions

Expert Solution

Answer: Option f. All of the following are true.
Explanation:

Option a. : The deduction under section 199A of the Tax Cuts and Jobs act allows 20% deduction to QBI.
Option b. : QBI is available to qualified business income of pass through entity so self employed can not use QBI to reduce their tax liability.
Option c. : QBI is treated as an itemized deduction so it will not reduce the gross total income.
Option d. : Specified service trades or business in some specified field of health, law, consulting,athentic, financ services etc then it does not fully qualify for QBI unless income of married people threshold $ 3,15,000 and for single people the threshold is $ 1,57,500.
Option e.: Thr QBI benefits are available to non C - corporations. So QBI deduction is available for some proprietorship ( schedule C), partnerships or even sub S corporations.
Option f. : As all the other options are correct so it is the correct answer.

ekkarill92 answered 7 months ago

Next > < Previous

Related Solutions

Taxpayers are allowed a deduction up to 20% of the qualified business income (QBI). QBI includes...

Taxpayers are allowed a deduction up to 20% of the qualified business income (QBI). QBI includes business income from sole proprietorships (Schedule C) and flow-through entities such as partnerships, limited liability companies, S corporations, trusts, and estates. Is this deduction the same as "Itemized deduction", and do you feel C Corporations should quality for this deduction.

WHICH OF FOLLOWING IS TRUE ABOUT QUALIFYING BUSINESS INCOME (QBI) DEDUCTION FOR TAXPAYERS WITH TAXABLE INCOME...

WHICH OF FOLLOWING IS TRUE ABOUT QUALIFYING BUSINESS INCOME (QBI) DEDUCTION FOR TAXPAYERS WITH TAXABLE INCOME ABOVE THE TAXABLE INCOME LIMITATIONS? A. IF THE TAXPAYER IS A SPECIFIED SERVICE TRADE OR BUSINESS (SSTB), NO DEDUCTION IS ALLOWED. B. IF THE TAXPAYER IS A QUALIFIED TRADE OR BUSINESS (QTB), W-2 WAGE AND PROPERTY LIMITATIONS DO NOT APPLY. C. IF THE TAXPAYER IS A QUALIFIED TRADE OR BUSINESS (QTB), W-2 WAGE AND PROPERTY LIMITATIONS ARE PHASED IN. D. IF THE TAXPAYER IS...

1) How does property used in a qualified trade or business factor into the QBI deduction...

1) How does property used in a qualified trade or business factor into the QBI deduction calculation under IRC Section 199A? What types of property are considered for the QBI deduction?

Describe the purpose behind the Qualified Business Income deduction and which taxpayers it is available to.

Thad, a single taxpayer, reports taxable income before the QBI deduction of $195,500. Thad, a CPA,...

Thad, a single taxpayer, reports taxable income before the QBI deduction of $195,500. Thad, a CPA, operates an accounting practice as a single member LLC (which he reports as a sole proprietorship). During the tax year, his proprietorship generates qualified business income of $156,400 after deducting self-employment taxes, W–2 wages of $117,300, and $10,000 of qualified property. Assume the QBI amount is net of the self-employment tax deduction. If required, round any division to two decimal places. Round your final...

Part1 Margen is single and has taxable income before the QBI deduction of $173,300. Margen owns...

Part1 Margen is single and has taxable income before the QBI deduction of $173,300. Margen owns a sole proprietorship (not a professional service) that produced net ordinary income of $180,000 and subject to self-employment tax of $21,300. The business paid total W-2 wages of $74,000 and the total unadjusted basis of property held by the business is $120,000. How much is Margen’s QBI deduction? Part2 a. Mourezky gave some long-term real estate to a church. The property was worth $33,000...

Is " qualified business income deduction" the same as "Itemized deduction", and do you feel C...

Is " qualified business income deduction" the same as "Itemized deduction", and do you feel C Corporations should quality for this deduction.

The qualified business deduction is calculated and applied at the partner, not the partnership, level. True...

The qualified business deduction is calculated and applied at the partner, not the partnership, level. True False A partnership is an association formed by two or more taxpayers (which may be any type of entity) to carry on a trade or business. True False

The deduction for qualified business income received a lot of praise and criticism in the press...

The deduction for qualified business income received a lot of praise and criticism in the press from the time it was introduced in November 2017 to the present. Find reliable articles that explain at least two arguments for and against the QBI deduction. Explain whether you agree with these positions and why. please provide: source link

With regard to the limitations of the QBI deduction, which of the following statements is not...

With regard to the limitations of the QBI deduction, which of the following statements is not true? 1) There are two potential limitations on the QBI deduction once a taxpayer's taxable income reaches certain levels. 2) There is no limitation on the QBI deduction besides the 20% rule. 3) The W-2 Wages/Capital Investment Limit can limit the QBI deduction to the greater of 50% of QBT W-2 wages or 25% of QT W-2 wages plus 2.5% of the acquisition basis...

Subjects