When TurboTax asks "Is this Qualified Business Income" do I answer "yes" even though we are an LLC (taxed as a partnership), and our members receive guaranteed payments, which I know do not qualify for the QBI? Will it all just work itself out?

danielle-51 · ‎February 13, 2023

HopeS · ‎February 13, 2023

Yes, partnerships generally are eligible for the Qualified Business Income Deduction (QBI) However, the guaranteed payment is not included in the QBI calculation. Guaranteed payments actually reduce the amount of income otherwise eligible for the QBI deduction.

TurboTax will automatically make the QBI deduction calculation for you.

Below are helpful links on Guaranteed Payment and QBI.

Calculation of Plan Compensation

Guaranteed payment on a partnership return

@danielle-51

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View solution in original post

HopeS · ‎February 13, 2023

Yes, partnerships generally are eligible for the Qualified Business Income Deduction (QBI) However, the guaranteed payment is not included in the QBI calculation. Guaranteed payments actually reduce the amount of income otherwise eligible for the QBI deduction.

TurboTax will automatically make the QBI deduction calculation for you.

Below are helpful links on Guaranteed Payment and QBI.

Calculation of Plan Compensation

Guaranteed payment on a partnership return

@danielle-51

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

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When TurboTax asks "Is this Qualified Business Income" do I answer "yes" even though we are an LLC (taxed as a partnership), and our members receive guaranteed payments, which I know do not qualify for the QBI? Will it all just work itself out?