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ajk2010foros
New Member

How does Turbotax calculate QBI deduction>?

 
7 Replies
VolvoGirl
Level 15

How does Turbotax calculate QBI deduction>?

My notes say

(1) the 1/2 SE tax deduction,

(2) Self Employed Health Insurance deduction, and

(3) employer retirement contributions

need to be subtracted from your business profit to determine "Qualified Business Income" (QBI) for the 20% deduction.

 

But One thing I found was my QBI credit was not as much as I thought it would be.  Because I had a business loss the prior year and it carried it over and took it into account.

VolvoGirl
Level 15

How does Turbotax calculate QBI deduction>?

ajk2010foros
New Member

How does Turbotax calculate QBI deduction>?

VolvoGirl,

 

Thanks for responding to my question and advising me that the 1/2 SE tax deduction must be subtracted from my business profit.  I didn't know it.  Thanks for a brief and clear explanation.

 

ajk2010foros

 

Anonymous
Not applicable

How does Turbotax calculate QBI deduction>?

it's not a credit it's a deduction  - credit saves you $ for $ deduction saves a max of about 40% federal   there is also a 4th category, for partherships, and the like  partners may deduct certain expenses against the partnership results , these to would need to be subtracted in fiquiring QBI. 

 

 

also say there are 3 trades or businesss  1 and 2  - $20,000 profit  each 3 - $10,000 loss the loss must be allocated to the profitable ones so each of 1 and 2 would only show a $15,00o of QBI and it gets even more complicated if any are a specified service trade or business.   

Anonymous
Not applicable

How does Turbotax calculate QBI deduction>?

 
ajk2010foros
New Member

How does Turbotax calculate QBI deduction>?

Thanks for the explanation.

VicSr
New Member

How does Turbotax calculate QBI deduction>?

Nice work VolvoGirl

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