S Corp Flashcards
1
Q
What is the QBI deduction formula?
A
Step 1: take 20% of income
Step 2: Calculate the greater of wage or wage/property limitation, which is 50% of your portion of W2 wages or 25% of W2 wages plus 2.5% your share of the property
Step 3: If income is between the 157.5k and 207.5k, calculate the taxable income in us the threshold of 157.5k over 50k
Step 4: Take the output of Step 3 and times your tentative QBI deduction minus the greater of w2 or w2 plus property times the step 3 limit, this will equal the partial limitation
Step 5: QBI Deduction from step 1 minus the partial limitation from step 3
2
Q
How is shareholder basis in an S Corp affected by liabilities?
A
Shareholder basis does not change based on the S Corps liabilities
