There are three limitations on the qualified business income deduction: an overall limitation (based on modified taxable income), another that applies to high income taxpayers, and a third that applies to certain types of service businesses.

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The qualified business income deduction (Section 199A) indeed has three main limitations: one based on the taxpayer's overall taxable income, a second that phases out the deduction for high-income taxpayers, and a third that restricts or phases out the deduction for specified service trades or businesses (SSTBs) once income reaches a certain threshold.

There Are Three Limitations on the Qualified Business Income Deduction