Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
cwpbsp
New Member

As an independent contractor and I receive a 1099 Misc. Can I use the qualified business income deduction?

 
2 Replies
JessicaB
Level 2

As an independent contractor and I receive a 1099 Misc. Can I use the qualified business income deduction?

It depends the type of service being provided and how your business is incorporated. The following fields are excluded: 

“Any trade or business involving the performance of services in the fields of health, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, brokerage services, or any trade or business where the principal asset of such trade or business is the reputation or skill of 1 or more of its employees or owners; or any trade or business which involves the performance of services that consist of investing and investment management, trading, or dealing in securities, partnership interests, or commodities.”

This new deduction applies to Schedule C filers (sole proprietorships and other self-employed businesses), LLCs, partnerships, S corporations, estates, and trusts.  Certain rental enterprises may also qualify . Corporations are not eligible because they received their own tax breaks under the TCJA.

That said, not every eligible business automatically qualifies for the deduction. In particular, some types of service businesses (SSTBs) are disqualified once the taxable income on the return exceeds $207,500 ($415,000 if filing jointly).

shellytfletcher
New Member

As an independent contractor and I receive a 1099 Misc. Can I use the qualified business income deduction?

I am not sure whether educational fields also apply to this exclusion:  I am an independent contractor (received 1099 Misc) working in early intervention (in home services to families of children with developmental delays), and my specialization is Early Childhood Special Education.  Would this be considered a qualified business? (It's not specifically among the fields mentioned, but has similarities in which the primary "value" lies within the information I am imparting to clients.)

 

 

Dynamic AdsDynamic Ads
Privacy Settings
v