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Level 1
January 31, 2020
Question

If I choose the foreign earned income exclusion as self-employed can I still claim the qualified business income deduction?

  • January 31, 2020
  • 2 replies
  • 0 views
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2 replies

Level 15
February 4, 2020

@jenniferaconners , as I understand the  QBI regs ----

 

(a) QBI does not include items such as:

items that are not properly includable in taxable income

.

.

  • Income that is not effectively connected with the conduct of business within the United States

(b) It has nothing to do with whether you claim Foreign Earned Income Exclusion or Foreign Tax credit -- depends only on the source  of the income i.e. it must be US sourced/ connected

 

Here is a good articulation of the can and cannots of the  QBI -->

https://www.taxlawforchb.com/2019/05/the-section-199a-deduction-effectively-connected-foreign-income/

 

Are you US citizen/Resident Alien/ Resident Alien for tax purposes ? Is your tax home abroad ?  Do you pass the Physical Presence Test ?  Which country is the income from ( self-employment ) -- assuming that the work was done abroad

Level 15
February 4, 2020

@jenniferaconners , as I understand the  QBI regs ----

 

(a) QBI does not include items such as:

items that are not properly includable in taxable income

.

.

  • Income that is not effectively connected with the conduct of business within the United States

(b) It has nothing to do with whether you claim Foreign Earned Income Exclusion or Foreign Tax credit -- depends only on the source  of the income i.e. it must be US sourced/ connected

 

Here is a good articulation of the can and cannots of the  QBI -->

https://www.taxlawforchb.com/2019/05/the-section-199a-deduction-effectively-connected-foreign-income/

 

 And here is more from the IRS -->

https://www.irs.gov/newsroom/tax-cuts-and-jobs-act-provision-11011-section-199a-qualified-business-income-deduction-faqs

 

 

Are you US citizen/Resident Alien/ Resident Alien for tax purposes ? Is your tax home abroad ?  Do you pass the Physical Presence Test ?  Which country is the income from ( self-employment ) -- assuming that the work was done abroad