QUALIFIED BUSINESS INCOME DEDUCTION IF YOU REPORT TRADE OR BUSINESS INCOME ON SCHEDULES C… E OR F… THERE'S A GOOD CHANCE THAT YOU WILL QUALIFY FOR A NEW TAX BENEFIT WHEN YOU FILE YOUR 2018 FEDERAL TAX RETURN. IT'S CALLED THE QUALIFIED BUSINESS INCOME DEDUCTION OR OFTEN REFERRED TO AS THE SECTION 199A DEDUCTION. THE NEW DEDUCTION CAN BE CLAIMED FOR UP TO 20 PERCENT OF YOUR QUALIFIED BUSINESS INCOME PLUS 20 PERCENT OF REAL ESTATE INVESTMENT TRUST DIVIDENDS AND PUBLICLY TRADED PARTNERSHIP INCOME. NOW… YOU'RE PROBABLY ASKING WHAT IS QUALIFIED BUSINESS INCOME? WELL… IF YOU ARE SELF-EMPLOYED OR AN INDEPENDENT CONTRACTOR IN THE UNITED STATES AND REPORT YOUR BUSINESS INCOME ON A SCHEDULE C WHEN YOU FILE YOUR TAXES… YOU LIKELY QUALIFY. THE SAME GOES IF YOU'RE AN OWNER IN A PARTNERSHIP OR S CORPORATION. BUT IF YOUR BUSINESSES ARE LOSING MONEY… YOU WON'T GET IT. ALSO… THERE ARE SOME IMPORTANT LIMITS THAT APPLY TO HIGHER INCOME TAXPAYERS. FOR TAX YEAR 2018… THESE LIMITS APPLY TO TAXPAYERS WHOSE TAXABLE INCOME EXCEEDS 315-THOUSAND DOLLARS FOR A MARRIED COUPLE FILING A JOINT RETURN OR 157-THOUSAND-500-DOLLARS FOR OTHER FILERS. IF YOU'RE ELIGIBLE FOR THE NEW QUALIFIED BUSINESS INCOME DEDUCTION… BE SURE TO CLAIM IT ON LINE NINE OF YOUR FORM 1040. YOU CAN FIND DETAILS… INCLUDING A USEFUL WORKSHEET… IN THE INSTRUCTIONS TO YOUR 1040 TAX RETURN. OR CHECK OUT OUR PUBLICATION ON BUSINESS EXPENSES AT I-R-S-DOT-GOV-SLASH-PUB 535.
