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Get your taxes done using TurboTax
Use Form 8995 Qualified Business Income Deduction Simplified Computation to figure your qualified business income (QBI) deduction.
The Qualified Business Income Deduction can be generated from one of two components.
- The QBI component can result from a sole proprietorship, partnership, S corporation, trust or estate. The first component would likely be reported on Schedule C, Schedule E, Schedule F or a K-1.
- The REIT / PTP component can be generated from qualified real estate investment trust (REIT) dividends or qualified publicly traded partnership (PTP) income. The second component could be reported on 1099-DIV or a K-1.
Are you reporting one or more of these types of income?
Hard to know about the Earned Income Credit (EIC) without seeing the details on your tax return. EIC qualifications are here.
First, you must have earned income. The IRS defines earned income as:
- Taxable income you earned as an employee, such as wages, salaries, commissions, and tips,
- Profits from operating your business or farm,
- Long-term disability pay if received before the minimum retirement age,
- Union strike benefits.
Here are all of the requirements to qualify for the Earned Income Credit:
- Have earned income; and
- Have been a U.S. citizen or resident alien for the entire tax year; and
- Have a valid Social Security number (not an ITIN) for yourself, your spouse (if filing jointly), and any qualifying children on your return; and
- Not have investment income exceeding $3,650; and
- Not be filing a Form 2555 or 2555-EZ; and
- File a return with the Single, Married Filing Jointly, Head of Household, or Qualifying Widower filing status, even if you're not required to file a return.
In addition, both your earned income and Adjusted Gross Income (AGI) may not exceed:
- $15,820 if you're not claiming a qualifying child ($21,710 if filing jointly);
- $41,756 if you're claiming 1 qualifying child ($47,646 if filing jointly);
- $47,440 if you're claiming 2 qualifying children ($53,330 if filing jointly);
- $50,954 if you're claiming 3+ qualifying children ($56,844 if filing jointly).
Hope this is helpful.
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March 7, 2021
9:11 AM