Margarita operates a sole proprietorship that earns $100,000 of qualified business income after deducting salaries of $300,000. The sole proprietorship is not a specified service business. She files a single tax return for 2019. Assume her taxable income before the QBI deduction is $175,000. Margarita's QBI deduction for 2019 is:

Question

Quizplus · Accepted Answer

The QBI deduction is generally 20% of qualified business income. Margarita's qualified business income is $100,000, so her QBI deduction is 20% of $100,000 = $20,000.

Margarita Operates a Sole Proprietorship That Earns $100,000 of Qualified