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Problem 2-35 (LO. 3, 4) Susan, a single taxpayer, owns and operates a bakery (as a...

Problem 2-35 (LO. 3, 4)

Susan, a single taxpayer, owns and operates a bakery (as a sole proprietorship). The business is not a "specified services" business. In 2019, the business pays $60,000 of W–2 wages and generates $200,000 of qualified business income. Susan also has a part-time job earning wages of $11,000 and receives $3,200 of interest income.

Assume the QBI amount is net of the self-employment tax deduction.

What is Susan's tentative QBI based on the W–2 Wages/Capital Investment Limit?
$

Determine Susan's allowable QBI deduction.
$

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Answer #1
Ans
QBI Based on W-2 wages =generated QBI-wages paid
=200000-60000
$ 1,40,000.00
Determine Susan's allowable QBI deduction.
Ans
20% of Net QBI
=20% of $140000
$ 28,000.00
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