Sarah is a 25% partner in a partnership that produces $750,000 ordinary income from manufacturing a product, her share of partnership income is $187,500.The partnership paid $150,000 of W-2 wages.Sarah is single and has taxable income of $500,000.What is Sarah's qualified business income deduction for 2019?

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Sarah's qualified business income (QBI) deduction is calculated as 20% of her share of the partnership income, which is $187,500. Therefore, 20% of $187,500 equals $37,500. However, the QBI deduction is subject to limitations based on W-2 wages and the unadjusted basis immediately after acquisition (UBIA) of qualified property, which are not applicable here. Since Sarah's taxable income is $500,000, she exceeds the threshold for single filers for the 2019 tax year ($160,700), which means her QBI deduction may be limited. The limitation based on W-2 wages and capital is not detailed here, but given the options and the information provided, the closest and most logical answer based on the calculation of 20% of her QBI is $18,750, which suggests that her deduction might be limited due to her high taxable income.

Sarah Is a 25% Partner in a Partnership That Produces