Section 199A QBI Deduction Calculator – 20% Pass-Through Tax Break & SSTB Limits

What is the Section 199A Qualified Business Income (QBI) Deduction?

Introduced in the Tax Cuts and Jobs Act (TCJA), Section 199A allows eligible self-employed individuals, sole proprietors, single-member LLCs, S-Corporation shareholders, and partnership members to deduct up to 20% of their Qualified Business Income (QBI) on their personal tax returns, effectively exempting one-fifth of business profits from federal income tax.

Income Thresholds & SSTB Restrictions

• Below Statutory Threshold: If taxable income is below $191,950 (Single) or $383,900 (Married Filing Jointly), taxpayers receive the full 20% deduction with zero wage or property tests, even if operating in service fields.
• Specified Service Trades or Businesses (SSTBs): For high-income professionals whose primary asset is their personal reputation or skill (physicians, attorneys, accountants, consultants, performing artists, athletes), the deduction phases out completely between $191,950 and $241,950 (Single) or $383,900 and $483,900 (Married). Architects and engineers are explicitly exempted from SSTB classification.
• Non-SSTB Wage & Property Limitations: Above the threshold for non-service businesses (e.g. real estate, tech software, manufacturing), the deduction is limited to the greater of 50% of W-2 wages paid OR 25% of W-2 wages + 2.5% of unadjusted basis of capital property (UBIA).

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