January 25, 2019

Qualified Business Income (QBI) deduction


The qualified business income (QBI) deduction is beneficial, but complex and subject to limitations. There are two ways to claim the Sec. 199A QBI deduction. One involves 20% of a taxpayer’s QBI and the other uses the amount of W-2 wages paid by an employer. New IRS guidance describes how to calculate W-2 wages for purposes of the deduction. The IRS has provided 3 methods of calculating applicable W-2 wages in Revenue Procedure 2019-11. For detailed explanations of the methods, go tohttp://bit.ly/2R5IBog,  or contact us for help with these complex calculations.