Dr. Marla Cratchitt is a single taxpayer and works as cardiologist. Marla is an investor in Salem Healthcare LLC, a business that manufactures stents for a variety of cardiovascular issues. Marla's member's interest in Salem is 20 percent and the LLC agreement calls for guaranteed payments to Marla of $75,000 per year. In 2018, Marla's ordinary business income allocation from Salem is $200,000. Salem also allocated $5,000 of long-term capital gains to Marla. Salem paid wages to employees of $230,000 and has qualified property of $1,200,000.
The taxable income phase-out ranges are $315,000 - $415,000 for married filing jointly and $157,500 - $207,500 for all other taxpayers.
a. Marla has taxable income of $776,000 for
purposes of the QBI limit. Compute Marla's qualified business
income (QBI) deduction.
$
b. Assume that same facts as part a. except that Salem is a service business. Compute Marla's QBI deduction.
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Dr. Marla Cratchitt is a single taxpayer and works as cardiologist. Marla is an investor in...
Thad, a single taxpayer, has taxable income before the QBI deduction of $190,700. Thad, a CPA, operates an accounting practice as a single-member LLC (which he reports as a sole proprietorship). During 2019, his proprietorship generates a qualified business income of $150,000, W–2 wages of $125,000, and $10,000 of qualified property. Assume the QBI amount is net of the self-employment tax deduction. What is Thad's qualified business income deduction?
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Exercise 2-19 (LO. 3, 4) Thad, a single taxpayer, has taxable income before the QBI deduction of $190,700. Thad, a CPA, operates an accounting practice as a single member LLC (which he reports as a sole proprietorship). During 2019, his proprietorship generates qualified business income of $150,000, W-2 wages of $125,000, and $10,000 of qualified property. Assume the QBI amount is net of the self-employment tax deduction. What is Thad's qualified business income deduction? $
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