The TCJA added a new section to the tax code, §199A, which is applicable from the tax year 2018 through the tax year 2025. §199A is often referred to as the 20% deduction or pass-through qualified business income deduction.
Under the new §199A, individuals, trusts, and estates may deduct up to 20% of QBI (defined later) received from the following:
Sole proprietorships (Schedules C, C-EZ, and F)
It is important to note, S-corporations and partnerships are pass-through entities; therefore, the entity is not eligible for the QBI deduction. It is the shareholders and partners who are eligible for the QBI deduction.
Corporations are not eligible for the new QBI deduction.