Yes, the QBI loss of $5,000 would carryover to the subsequent year. It would retain its character though as a QBI carryover loss. In other words, it would offset positive QBI.
Yes, TTS without the 475 election are still eligible for the QBI deduction; however, with no income on a Schedule C, there is no positive QBI to offset with a QBI carryover loss. Remember, TTS with no 475 election report their gains/loss on Schedule D and Form 8949 and those gains/losses are capital gains/capital losses. Without the 475 election, the TTS gains/losses are subject to the capital loss limitation of $3,000 and TTS are subject to the wash sale rule.
You are correct in that TTS is considered a specified trade or business and as such is subject to income thresholds. Regarding QBI income thresholds the IRS has stated:
- If your 2021 taxable income before the QBI deduction isn’t more than $329,800 married filing jointly, $164,925 for married filing separately, and $164,900 for all other returns, your SSTB is treated as a qualified trade or business, and thus may generate income eligible for the QBI deduction.
Here is a link to the IRS publication that discusses the QBI deduction. The above quote was obtained from page 2 of the publication.
Deduction for Qualified Business Income
@Lucy196
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