QBI Deduction Calculator 2026  •  IRC 199A

Section 199A qualified business income deduction. W-2 wage limitation. UBIA property alternative. SSTB phaseout for high-income taxpayers. Made permanent by OBBBA. Schedule D / Form 8995-A.
IRC 199A - QBI deductionIRC 199A(b)(2) - W-2 wage limitIRC 199A(d) - SSTBOBBBA permanentForm 8995-A
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Business & Taxpayer Information

Net income from qualified trade or business. Excludes: capital gains, dividends, interest (not business), reasonable compensation (S-corp), guaranteed payments (partnership). IRC 199A(c).
Form 1040 taxable income before the 199A deduction. QBI deduction is limited to 20% of taxable income minus net capital gains. IRC 199A(a).
Total W-2 wages paid to employees (including reasonable compensation paid to S-corp owner-employee). Key factor in W-2 wage limitation. IRC 199A(b)(2)(B).
Unadjusted basis immediately after acquisition of qualified property (depreciable property). Used in alternative W-2+UBIA limitation. IRC 199A(b)(2)(B)(ii). Most service businesses: $0.
SSTBs: health, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, investing, trading, brokerage. Engineering and architecture are NOT SSTBs. IRC 199A(d)(1)(A).
Net capital gains reduce the overall taxable income cap. Overall limit = 20% x (taxable income - net capital gains).
REIT dividends and qualified publicly traded partnership income also qualify for the 20% deduction without W-2 wage limitation. IRC 199A(e)(4).
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QBI Deduction Results

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