Who Gets the Qualified Business Income Deduction?
As some of you may know, the Tax Cuts and Jobs Act (TCJA) introduced a 20-percent qualified business interest income deduction provision, which potentially benefits all taxpayers except C corporations.
For clients who are S corporation shareholders, partners and sole proprietors, they may also benefit as can trusts, estates and their beneficiaries (Sec. 199A. or see generally Conf. Rep. to the TCJA, p. 205-224). The provision is, however scheduled to expire in tax years beginning after 2025, so let’s explore what’s in it, who qualifies and who does not for tax planning purposes.