Under the Tax Cuts and Jobs Act, there is potentially a 20 percent deduction for qualified business income from a qualified trade or business operated directly or through a pass-through entity. It is important to talk with a trusted tax accountant in Fort Collins to understand what that means for your business.
According to the IRS, there are two components to the qualified business income deduction:
1. Eligible taxpayers may be entitled to a deduction of up to 20 percent of qualified business income (QBI) from a domestic business operated as a sole proprietorship or through a limited liability company, partnership, S corporation, trust or estate.
2. Eligible taxpayers may also be entitled to a deduction of up to 20 percent of their combined qualified real estate investment trust (REIT) dividends and qualified publicly traded partnership (PTP) income.
However, there are certain factors that must be considered. For example, taxpayers that have a taxable income greater than $315,000 for a married couple filing jointly or $157,500 for all others must meet additional tests relative to wages paid and assets owned that could limit the deduction.
What those limitations are and how they affect an entity’s tax return will vary. However, you can claim as much of the deduction as you are entitled to and file confidently by working with a tax accountant in Fort Collins to analyze your specific tax position.
Get Sound Advice and Assistance From a Knowledgeable Tax Accountant in Fort Collins
When talking with a tax accountant in Fort Collins, you want insights from a tax professional who is well-versed in the tax code. At Shaw & Associates, our skilled and experienced CPAs understand all the nuances of existing regulations and also study the latest changes like the qualified business income deduction so that we can help our clients benefit from them.
Contact us today to learn more about our accounting and financial advising services.