The New 20% Deduction Continued

There is a taxable income limit on the new 20% of qualified business income deduction. If single, your limit is $157,500 and joint is $315,000. The anti abuse rules limiting the 20% deduction only kick in above these amounts. So if your taxable income is under these amounts the full 20% deduction applies to your business net income. Then the rest of your business income including wages is subject to up to a 37% tax rate. I will discuss the anti abuse rules limiting the 20% deduction in my next tax blog.