Felipe, a single taxpayer, is a technology consultant who operates as a sole proprietorship. Felipe’s net business income is $600,000 (net of the associated for AGI self-employment tax deduction), he pays wages of $100,000 to his employees, and he has $200,000 of qualified property (unadjusted basis). Felipe’s taxable income before the deduction for qualified business income is $500,000. Assume he has no capital gains or qualified dividends. Required: a. Calculate Felipe’s deduction for qualified business income. b. Calculate Felipe’s deduction for qualified business income if Felipe was an investment broker? Part a Part b Deduction for qualified business income $ $ (For all requirements, leave no answer blank. Enter zero if applicable.)

Felipe, a single taxpayer, is a technology consultant who operates as a sole proprietorship. Felipe’s net business income is $600,000 (net of the associated for AGI self-employment tax deduction), he pays wages of $100,000 to his employees, and he has $200,000 of qualified property (unadjusted basis). Felipe’s taxable income before the deduction for qualified business income is $500,000. Assume he has no capital gains or qualified dividends. Required: a. Calculate Felipe’s deduction for qualified business income. b. Calculate Felipe’s deduction for qualified business income if Felipe was an investment broker? Part a Part b Deduction for qualified business income $ $ (For all requirements, leave no answer blank. Enter zero if applicable.)

SWFT Individual Income Taxes

43rd Edition

ISBN:9780357391365

Author:YOUNG

Publisher:YOUNG

Chapter5: Gross Income: Exclusions

Section: Chapter Questions

Problem 18DQ

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