Danielle is a partner in and sales manager for DG Partners, a domestic business that is not a specified service trade or business. During the tax year, she receives guaranteed payments of $250,000 from DG Partners for her services to the partnership as its sales manager. In addition, her distributive share of DG Partners' ordinary income (its only item of income or loss) was $175,000. What is Danielle's qualified business income?
A) $-0-.
B) $175,000.
C) $250,000.
D) $425,000.
E) None of these.

Question

Quizplus · Accepted Answer

Danielle's qualified business income (QBI) includes her distributive share of the partnership's ordinary income but does not include guaranteed payments for services. Therefore, her QBI is $175,000.

Danielle Is a Partner in and Sales Manager for DG