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Level 1
posted Sep 29, 2023 8:46:18 AM

Freelancer w/ Multiple Clients possibly having Former Employer as Client (QBI Deduction forfieted?)

So I have been doing freelance work for a handful of clients for a handful of years now.

I was also doing part-time work as an employee (getting a W2 from the employer) for another single organization.

I'm planning on leaving the organization where I was an employee, but they are interested in me doing some work (not the full role) on a freelance basis.

 

I've seen some discussion about former employees doing work on a contractor basis and not being able to participate in the QBI deduction (such as this thread https://ttlc.intuit.com/community/tax-credits-deductions/discussion/hired-as-a-independent-contractor-by-former-employer/00/2635720 )

 

I could understand if I'm not able to deduct 20% of the income of this particular revenue stream from a client that is a past employer.  

 

However, I want to make sure I'm not also forfeiting the possibility of deducting 20% of the income from my other, existing clients (that aren't past employers).   

 

Ultimately, I want to make sure I'm not penalizing myself for doing work with my past employer.  (Basically losing money in the short term, as a result)

 

Any thoughts on this?

 

Thank you so much for your time!

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2 Replies
Level 15
Sep 29, 2023 10:14:57 AM

I'm going to page @Mike9241 for this (which I believe you intended to write "QBI").

Level 1
Sep 29, 2023 10:50:16 AM

Ah thank you -- I'll try to correct that 🙂