Yes, you probably will qualify.
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. The IRS will be issuing separate guidance for co-ops.
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.
A qualified
trade or business is any trade or business, with two exceptions:
- Specified service trade or business
(SSTB), which includes a trade or business involving the performance of
services in the fields of
health, law, accounting, actuarial science, performing arts, consulting,
athletics, financial services, investing and investment management,
trading, dealing in certain assets or any trade or business where the
principal asset is the reputation or skill of one or more of its
employees. This exception only applies if a
taxpayer’s taxable income exceeds $315,000 for a married couple filing a
joint return, or $157,500 for all other taxpayers
- Performing
services as an employee
