Calculate Your QBI Deduction
The Section 199A deduction allows pass-through businesses to deduct up to 20% of qualified business income. Use our free calculator to see your potential deduction and understand how income thresholds and SSTB rules affect you.
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Businesses Helped
Maximize QBI deduction
$12,000
Avg. Deduction
For qualifying businesses
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QBI Deduction Calculator
Calculate your Section 199A pass-through deduction
Important: The QBI deduction expires after 2025 under current law unless Congress extends it.
Net profit from your pass-through business (Schedule C, K-1, etc.)
Your total taxable income including this QBI, before the QBI deduction.
Example: If your adjusted gross income is $200,000 and you take $24,000 standard deduction, enter $176,000.
SSTB = Specified Service Trade or Business (doctors, lawyers, consultants, etc.)
QBI Deduction
$20,000
Tax Savings
~$4,800
Status
Full
Disclaimer: This calculator provides estimates for educational purposes only. Actual QBI deduction depends on your specific circumstances, including other income sources and deductions. Consult with a qualified CPA for personalized tax planning advice.
Understanding the QBI Deduction
The Qualified Business Income (QBI) deduction, enacted as part of the Tax Cuts and Jobs Act of 2017, allows eligible self-employed individuals and small business owners to deduct up to 20% of their qualified business income.
Who Qualifies for the QBI Deduction?
The deduction is available to pass-through businesses, including:
- Sole proprietorships (Schedule C filers)
- Partnerships and LLCs
- S Corporations
- Trusts and estates
However, the deduction may be limited or eliminated based on your taxable income and whether your business is classified as a Specified Service Trade or Business (SSTB).
What is an SSTB?
Specified Service Trades or Businesses (SSTBs) include professional services where the principal asset is the reputation or skill of employees:
- Health (doctors, dentists, nurses)
- Law (attorneys, legal services)
- Accounting (CPAs, bookkeepers)
- Consulting (management, business consulting)
- Financial services and brokerage
- Performing arts and athletics
Important: Engineering and architecture are specifically excluded from the SSTB definition, meaning these professionals can claim the full QBI deduction regardless of income level.
Income Thresholds and Phase-Outs
For 2025, the phase-out thresholds are:
- Single filers: $197,300 (low) to $247,300 (high)
- Married filing jointly: $394,600 (low) to $494,600 (high)
If your taxable income is below the low threshold, you receive the full 20% deduction regardless of SSTB status. If you're an SSTB above the high threshold, you receive no deduction. In between, the deduction is phased out proportionally.
The 2026 Sunset Warning
Critical: The QBI deduction is scheduled to expire after December 31, 2025, unless Congress acts to extend it. If you have qualifying business income, consider maximizing this deduction in 2024 and 2025 while it's still available.
Need help maximizing your QBI deduction?
The QBI deduction has complex rules that vary by business type, income level, and W-2 wages paid. A qualified CPA can help you structure your business to maximize this valuable deduction before it potentially expires.
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