qualified business income deduction

[t5641]

I am confused on the qualification of the qualified business income deduction.  I have two scenarios

1.  A sole proprietor massage therapist performs her duties for a chiropractor's office.  No other expenses, but is 1099'ed.  Would this income qualify?

2.  A special education teacher works through an agency. Visits clients and is 1099'ed.  Has mileage deductions etc.  Would this income quality?

Does it matter if you are 1099-misc or 1099-NEC?

In practice, would any 1099 person qualify for this since they are self employed?

[KrisD15]

No, it does not matter if they receive a 1099-MISC or 1099-NEC

The easier question to answer is "What business does NOT qualify for the QBI?"

NONE, they all do, however-

There are limits to the Qualified Business Deduction for a Specified Service Trade or Business. 

It does not matter where the therapist performs her service, the question would be if it is related to a medical purpose.

If Yes, it would be a SSTB. 

The Special Education teacher- doubtful, but again would need to review his connection to any medical purpose. 

The QBI is only "possibly limited" if the Taxpayer is considered a SSTB, depending on their income, so it might not even matter. 

Link to Specified Service Trade or Business

[t5641]

Thank you so much.  Both of my examples the person would earn under the threshold.  So, it sounds like they both would qualify?  

It seems like as long as you are under the income threshold and you receive a 1099, for the most part you would qualify.  Am I reading this the right way?

[MinhT1 · Accepted solution]

Yes, your reading is correct.

[t5641]

Thank you so much for your help!

[jrgriggs1]

Why would the IRS send me a letter saying I owe more tax because my Qualified Business Income Deduction was figured incorrectly using TurboTax?

[DoninGA]

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@jrgriggs1 wrote:

Why would the IRS send me a letter saying I owe more tax because my Qualified Business Income Deduction was figured incorrectly using TurboTax?

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