Question

Alan and Melissa are equal partners in a non-corporate business. The business has a gross income...

Alan and Melissa are equal partners in a non-corporate business. The business has a gross income of $320,000 and has operating expenses of $210,000. They are both single. Alan also has long-term capital gains of 25,000. Assume that Alan and Melissa have no other income and no itemized deductions. What is the amount of the qualified business deduction for both of them?

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Answer #1
Capital gains does not consider for qualified business income.
Gross income $        320,000
Less: Operating expenses $        210,000
qualified business income [QBI] $        110,000
Multiply: deduction is allowed 20 percent of QBI 20%
Amount of the qualified business deduction for both of them $          22,000
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