SSTB

[mvp2885]

Hello. Got a question, actually about my own LLC return. This is an SSTB. Two partners will report less than the SSTB thresholds, the other partner is way over that amount. So for the question that asked "SSTB Yes or No" if I select yes, will thethreshold amounts depend on the individual's 1040 income? 

For example if partner B earns $560,000 and A earns $80,000, partner A can use the QBI, but not partner B for an SSTB? 

[dascpa]

Whether the LLC has SSTB activity is at the entity level.  Whether the individual can qualify for the Sec. 199A QBI deduction is at the individual level.  One member's return has no bearing on another member's return.

[mvp2885]

Correct! That I understand. However my dilemma is in reference to the thresholds. Since SSTB has it's threshold levels, are those amount based on business income or individual income? 

Here is the link from the IRS; https://www.irs.gov/newsroom/facts-about-the-qualified-business-income-deduction

[dascpa · Accepted solution]

The calculation of a QBI deduction is on the 1040 based upon the 1040 income which of course the K-1 from the LLC is just one component of income.  So if the K-1 income was $100,000 but the spouse's W-2 was $400,000 they would be over the SSTB QBI threshhold.

[mvp2885]

Got it! Thanks!