The Qualified Business Income (QBI) Deduction: It Actually Makes Sense!
Tax Briefings 2018 (4:00 - 5:45 p.m.)
The 2017 Tax Act (Act) contains many provocative provisions, but nothing is newer, more exciting or more exotic than the Qualified Business Income (QBI) Deduction. This deduction allows owners of pass-through businesses (which is to say, almost every private business in the US) an opportunity to deduct (i.e., exclude from taxation) up to 20% of otherwise-taxable business income. Whoa!
The QBI Deduction has been described as a 20% reduction in the taxpayer’s effective tax rate, but actually it is even better than that! The 20% deduction reduces income that would otherwise be taxed in the taxpayer’s highest bracket, and thus, in most cases, the total reduction in tax is better than “20% off” — sometimes it can be 25% or even higher. It is a BIG DEAL.
The QBI Deduction rewards non-service businesses that spend significant amounts on payroll and tangible business property. It is also available for service businesses, but the benefits are capped over a relatively narrow range of taxable income, so careful early planning is essential.
Come learn the latest mathematical insights and corresponding tax strategies from Joseph Darby to help you maximize the QBI Deduction and minimize your tax bill for 2018.