Question

# Glen owns and manages a single member LLC that provides financial consulting to his clients. He...

Glen owns and manages a single member LLC that provides financial consulting to his clients. He is married and will file a joint return with his wife Diane. HI LLC has net income of \$290,000. The LLC pays out W-2 wages of \$100,000 and has with an unadjusted basis of \$50,000. Glen and Diane's taxable income before the QBI deduction is \$305,000, this is also modified taxable income. Determine the QBI deduction for 2018.

As Glen owns and manages a LLC (Limited Liability Company).

Total taxable income from all sources deductions, including standard deduction

Glen file a joint return with his wife Diane (for 2018 married couples standard deduction is \$24000).

Net Amount = \$290000

QBI deduction = \$305000

W-2 wages = \$100000

Assets with an unadjusted basis = \$50000

Max possible pass through deduction = 20% * 305000

= \$61000

The income is not over \$415000. Glen do not qualify for the deduction of W-2 wages.

so we will get \$61000 QBI.

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