QBI is not a credit, it is a deduction for businesses. TurboTax can calculate your income to see if you qualify.
The information below is from IRS.
Q1. What is the Qualified Business Income Deduction?
A1. Section 199A
of the Internal Revenue Code provides many taxpayers a deduction for qualified
business income from a qualified trade or business operated directly or through
a pass-through entity. The deduction has two components.
- Eligible taxpayers may be entitled to a
deduction of up to 20 percent of qualified business income (QBI) from a
domestic business operated as a sole proprietorship or through a
partnership, S corporation, trust or estate. For taxpayers with taxable
income that exceeds $315,000 for a married couple filing a joint return,
or $157,500 for all other taxpayers, the deduction is subject to
limitations such as the type of trade or business, the taxpayer’s taxable
income, the amount of W-2 wages paid by the qualified trade or business
and the unadjusted basis immediately after acquisition (UBIA) of qualified
property held by the trade or business. Income earned through a C
corporation or by providing services as an employee is not eligible for
the deduction.
Q2.
Who may take the section 199A deduction?
-
A2. Individuals,
trusts and estates with qualified business income, qualified REIT dividends or
qualified PTP income may qualify for the deduction. In some cases, patrons of
horticultural or agricultural cooperatives may be required to reduce their
deduction.
Q4. What is qualified business income (QBI)?
A4. QBI is the net amount of qualified items of income, gain, deduction and loss from any qualified trade or business. Only items included in taxable income are counted. In addition, the items must be effectively connected with a U.S. trade or business. Items such as capital gains and losses, certain dividends and interest income are excluded.
