2023 UPDATE: 2023 "Low Threshold": Ordinary Taxable Income of $364,200 for Married Filing Jointly, and $182,100 for all other statuses. 2023 "High Threshold": Ordinary Taxable Income of $464,200 for Married Filing Jointly, and $232,100 for all other statuses.

Awesome vid, I couldn't understand business deductions FOR AGI vs FROM AGI before this, but I get it now. Def gonna help with my tax class. Thank you!

@TheTaxGeek

2 жыл бұрын

I'm so glad I could clear that up for you!

excellent quality video and engaging, thank you so much! subbed

@TheTaxGeek

3 жыл бұрын

Thanks and welcome

Thank you for simplifying this.

@TheTaxGeek

2 жыл бұрын

You're very welcome!

Thank you so much for the information! You are a lifesaver

@TheTaxGeek

2 жыл бұрын

You are so welcome!

Excellent, thank you!!!

@TheTaxGeek

3 жыл бұрын

Glad it was helpful!

Very helpful video. Subscribed!

@TheTaxGeek

2 жыл бұрын

Thanks! I'm glad you found it helpful!

The form 8995 makes no mention of deducting the standard deduction in the calculation on lines 11 - 13.

@TheTaxGeek

3 жыл бұрын

It certainly doesn't. To get the figure on line 11, you take your Adjusted Gross Income and subtract either your standard deduction or your itemized deductions, if. you are taking them. Subtract your net capital gains (line 7 of Form 1040) to arrive at your ordinary taxable income for QBID purposes. This is precisely why we use computers to prepare taxes these days.

It is my understanding that Schedule C (Line 31) profit must be reduced by (1/2 Self-employment tax + Self-Employment Health insurance Deduction + IRA contributions) when tallying QBI.

@TheTaxGeek

2 жыл бұрын

Yes, that is covered in the video when "qualified business income" is defined.

I find this form very clunky. It's odd what the IRS chooses to be worked out in the form vs off-form via instructions. Thank you for clarifying it!

@TheTaxGeek

3 ай бұрын

I don't give my opinion on the tax code very often, but IMO QBID is one of the most needlessly overcomplicated provisions in the tax code.

Would you please help me to figure estimated tax payments for 1099 workers and /or W-2 ? Thank you.

@seekinghimdaily92

Жыл бұрын

I honestly would recommend using QBO or Quickbooks Self-employed for that. They give a discounted first 3 months for the subscription.

how would the ordinary taxable income be calculated for those "married filing jointly"?

@TheTaxGeek

2 жыл бұрын

It's based on both spouse's incomes, even if only one had qualified business income.

Can you help me out? I took another job but the job I left was so desperate that they paid me as a contractor. The work was essentially what I used to do for them. I received a 1099 Nec from them. Do I qualify for the QBI deduction? TT says no because I did the same work as a contractor as I did when I was a full time employee.

@TheTaxGeek

2 жыл бұрын

Yes, absolutely you can take a QBI deduction. If you are paid on a 1099 NEC, you are considered to be in business for yourself and the IRS expects the income to be reported on a Schedule C. Schedule C income is Qualified Business Income. I'm sorry that your employer chose to skirt payroll taxes and wage and hour laws by paying you as a contractor when you were, for all intents and purposes, an employee. But that doesn't mean you aren't entitled to a QBI deduction just like any other person in business for themselves.

@lieslceleste3395

2 жыл бұрын

@@TheTaxGeek Thanks. That’s not what happened though. They are relocating so I took another job. They then became desperate and offered me to work part time as a contractor until they presumably get someone else to take over. Turbo Tax asks if it’s essentially the same job. (I’m guessing the govt doesn’t want an end run around just for the company to avoid taxes) It’s only the same job in the sense that I’m doing a small portion of what I used to do for them. I have a full time job with another company. I was worried that the IRS would disallow the QBI deduction.

@TheTaxGeek

2 жыл бұрын

I believe that TT asks you that question is to see if you want to file Form SS-8, to reclassify your work as an independent contractor as an employee. Don't do that, it stirs up a huge hornets nest for both you and your (former) employer. Go ahead and file your NEC on a Schedule C. You'll pay some self-employment tax, but get the QBID. The IRS will not question it.

@lieslceleste3395

2 жыл бұрын

@@TheTaxGeek Thanks. It really isn’t the same job anyway since I’m only doing a very small portion of the original job. I have a full time job at the new place. I just thought I’d help them out and make a little extra money. Thanks again for your help.

Can u be qbi last yr and non qbi this yr?

@TheTaxGeek

2 жыл бұрын

Yes.

Not helpful. You did not show how to fill out the QBI as your topic says.