cpa773
Level 1
12-07-2019
12:27 AM
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George4Tacks
Level 15
12-07-2019
12:27 AM
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Lacerte does it proportionally to the SE income for each business. One with 200K and another with 100K will be reduced by 2/3 and 1/3 of the SE tax, respectively.
Regardless of whether it is SSTB.
Answers are easy. Questions are hard!
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TaxGuyBill
Level 15
12-07-2019
12:27 AM
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I don't know what the program does, but should NOT do that.
However, can you clarify why the self-employment income does not qualify for QBI?
However, can you clarify why the self-employment income does not qualify for QBI?
rbynaker
Level 13
12-07-2019
12:27 AM
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The only way I can get the question to make sense is to imagine a scenario with two sources of SE income, one QBI, the other SSTB with the TI over the upper limit ($415K). Then you'd have to allocate the self-employment tax deduction. I think the final regs say that's done based on "gross income" for some reason but I'd have to look it up again.
rbynaker
Level 13
12-07-2019
12:27 AM
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Is this what we're talking about?
"For purposes of section 199A only, deductions such as the deductible portion of the tax on self-employment income under section 164(f), the self-employed health insurance deduction under section 162(l), and the deduction for contributions to qualified retirement plans under section 404 are considered attributable to a trade or business to the extent that the individual’s gross income from the trade or business is taken into account in calculating the allowable deduction, on a proportionate basis to the gross income received from the trade or business."
"For purposes of section 199A only, deductions such as the deductible portion of the tax on self-employment income under section 164(f), the self-employed health insurance deduction under section 162(l), and the deduction for contributions to qualified retirement plans under section 404 are considered attributable to a trade or business to the extent that the individual’s gross income from the trade or business is taken into account in calculating the allowable deduction, on a proportionate basis to the gross income received from the trade or business."
George4Tacks
Level 15
12-07-2019
12:27 AM
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Lacerte does it proportionally to the SE income for each business. One with 200K and another with 100K will be reduced by 2/3 and 1/3 of the SE tax, respectively.
Regardless of whether it is SSTB.
Answers are easy. Questions are hard!