QBI Deduction

[jdawg31jdawg]

I was a self-employed insurance salesman beginning in April 2019. I completed my Sch C in Turbo Tax, but did not receive a QBI deduction. I had a net profit, so I believe I should receive one as an independent contractor. What can I do to generate the deduction?

[JohnW222]

As an insurance salesman, you probably received a Form W-2. 

If your W-2 has the "statutory employee" box on line 13 checked, make sure that that's reflected on the W-2 that you input into TurboTax. 

Generally, wages aren't considered QBI, but if you're a statutory employee (indicated by the "statutory employee" box on line 13 of your W-2 being checked), then the income from the statutory W-2 is not considered wages for QBI purposes.

[jdawg31jdawg]

I did not receive a W-2. I received a 1099 and therefore filed a Sch C showing my income and expenses.

[DeanM15]

To get the QBI Deduction, go back to the Self Employment Section. Click into the business you want to change. Once on the main page, scroll to the bottom, under Business Summary, click Edit next to Qualified Business Income. Walkthrough the questions. 

[GaryTTax]

TurboTax Home & Business 2021

My uploaded W2 indicates Statutory Employee, but Schedule C only shows expenses and loss without the income. Hence, QBI is calculated as $0. Is there a solution or do I need to go to H&R Block and chalk up the TTax cost as a loss?

[AliciaP1 · Accepted solution]

You need to link your W-2 to the Schedule C.  You can walk through the step-by-step process for the W-2 and the questions after will identify the W-2 as the income for the Schedule C.

To do this please follow these steps:

1. Within your tax return,  use the magnifying glass to search for w-2 and click the Jump to link in the results
2. Click Edit for the W-2 you need to link to the Schedule C
3. Click Continue through the screens until you get to the Tell us more about your role as a statutory employee screen
4. Identify the type of employee you are and click Continue
5. Click Yes for business expenses and Continue
6. Select the Schedule C you have to attach the income

@GaryTTax

[GaryTTax]

Alicia,

Thank you. I had not gone far enough in the process.

Best,

Gary