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Mary a single taxpayer, has $400,000 of profits from her general store, which she operates as...

Mary a single taxpayer, has $400,000 of profits from her general store, which she operates as a sole proprietorship. She has no employees, $40,000 of qualified property, and $500,000 of taxable income before the deduction for qualified business income. How much is Mary's deduction for qualified business income?

$1,000

$100,000

$80,000

$20,000

$0
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Answer #1

Answe : Option A , $1,000

Explanation;  

Her deduction for qualified business income is limited to 25 % of her wages plus 2.5 % of her qualified property.

$40,000 × 2.5 % = $1,000

Qualified Business Income = $1,000

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