Determine whether the following taxpayers are eligible for theQBI deduction and the deduction amount...

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Accounting

Determine whether the following taxpayers are eligible for theQBI deduction and the deduction amount (if any). Cathy is marriedand files a joint return with her spouse. Cathy operates a smallfamily restaurant as a sole proprietor. She pays wages of $70,000and the QBI from the restaurant is $100,000. Cathy’s spouse haswages of $250,000 and their joint taxable income is $364,000. IsCathy eligible for QBI deduction? Answer yes or no If eligible, howmuch is the QBI deduction amount?

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As per IRS Sec 199A allows a deduction for up to 20 of QBI from partnerships limited liability companies LLCs S corporations trusts estates and soleproprietorships Sec 199A creates a deduction based on an artificial calculation of business income instead of actual economic outlays required for most other business deductions taxpayers with taxable income of more than 415000 the higher threshold are denied the Sec 199A deduction See Answer

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In: AccountingDetermine whether the following taxpayers are eligible for theQBI deduction and the deduction amount (if...Determine whether the following taxpayers are eligible for theQBI deduction and the deduction amount (if any). Cathy is marriedand files a joint return with her spouse. Cathy operates a smallfamily restaurant as a sole proprietor. She pays wages of $70,000and the QBI from the restaurant is $100,000. Cathy’s spouse haswages of $250,000 and their joint taxable income is $364,000. IsCathy eligible for QBI deduction? Answer yes or no If eligible, howmuch is the QBI deduction amount?