IRA Deduction Worksheet LIne 2 earned income for self employment

[jenfeldmann]

The IRA Deduction Worksheet, Line 2 earned income for self employment.

Turbotax does not reduce this by the self employed insurance deduction which is on Schedule 1 Line 17.

Qualified Business Income for form 8995 is reduced by the self employed insurance deduction.

Can anyone confirm that the IRA Deduction Worksheet is correct, and cite the source of the information?

[JosephS1]

I cannot confirm the worksheet is correct as the current IRS publication does state that you must reduce self-employment income by the deduction allowed for the deductible part of your self-employment taxes (screenshot below).

The above was taken from Page 6 of Publication 590-A.

Publication 590-A

@jenfeldmann 

[dmertz]

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@jenfeldmann wrote:

The IRA Deduction Worksheet, Line 2 earned income for self employment.

Turbotax does not reduce this by the self employed insurance deduction which is on Schedule 1 Line 17.

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That's correct.  It's not supposed to.  The deduction for self-employed health insurance is a personal deduction, not a business deduction.  See What Is Compensation in IRS Pub 590-A:

https://www.irs.gov/publications/p590a#en_US_2021_publink1000230359

QBI is calculated differently.

@JosephS1 , there is no bug.