Question

The revised text of the Tax Cuts and Jobs Act (TCJA) of 2017 provides some support for sole-proprietorships, partnerships and S-corporations, but yet has eliminated certain miscellaneous deductions. Are sole proprietorships, partnerships and S-corporations truly benefitting from the revisions proposed by the TCJA of 2017?

Answer 1

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Answer is highlighted in yellow: Solution: Yes Answer: Explanation: Because, sole proprietorships, partnerships and S-corporations got Qualified business income deduction of 20% of lower of business income or Taxable income. Which is a significant part of deduction and tax support than other small deduction. As these entities are pass through entities, their net income is taxed at individual levels. Which attract greater standardized deduction, although personal exemption has been eliminated but some compensation of personal exemption has been added to standard deduction by increasing it almost double. Thus, These entities are truly getting benefits from the revisions proposed by the TCJA of 2017.