Gary has qualified business income of $40,000 in 2018.His taxable income without net capital gains is $28,000.Gary's QBI deduction for 2018 is?
A)$0
B)$5,600
C)$8,000
D)$13,600

Question

Quizplus · Accepted Answer

The QBI deduction is the lesser of 20% of qualified business income ($40,000 x 20% = $8,000) or 20% of taxable income without net capital gains ($28,000 x 20% = $5,600). Therefore, the QBI deduction is $5,600.

Gary Has Qualified Business Income of $40,000 in 2018