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Calculating the Deduction - QBI

Overall, the amount of QBI deduction equals:


20%  of QBI Component + 20% of Qualified REIT/PTP Component = QBI Deduction


The deduction is limited to the lesser of the total of the calculation above or 20% of the taxable income minus any net capital gain.


Individuals who are eligible to claim the QBI deduction will enter the deduction on page 2 of Form 1040, line 9.  For 2018 the IRS created two worksheets to assist in calculating the QBI deduction.  The 2018 worksheets, along with instructions were found in Publication 535.  As indicated later in this section, these worksheets will be replaced for the tax year 2019 by Forms 8995 and 8995-A.  As of the date these materials were printed, the IRS has not finalized these new forms.  Other than the inflation-adjusted taxable income amounts for 2019, the steps for each calculation will be the same as on the 2018 worksheets from Publication 535.


QBI Deduction:




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Cathy Fisher

Common Cents Bookkeeping and Tax Preparation

Serving Henderson, NC, Buncombe County, Polk County, Transylvania County

E: cathy@commoncentsqbo.com

P: 828-595-2835

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