06. How is the deduction for qualied business income computed? A6. The SSTB limitation discussed does not apply if a taxpayer's taxable income is below $315,000 for a married couple ling a joint return and $157,500 for all other taxpayers; the deduction is the lesser of: A) 20 percent of the taxpayer's QBI, plus 20 percent of the taxpayer's qualied real estate investment trust {REIT} dividends and qualied publicly traded partnership (FTP) income B} 20 percent of the taxpayer's taxable income minus net capital gains. if the taxpayer's taxable income is above the $315,000]$157,500 thresholds, the deduction may be limited based on whether the business is an SSTB, the W-Z wages paid by the business and the unadjusted basis of certain property used by the business. These limitations are phased in for joint lers with taxable income between $315,000 and $415,000, and all other taxpayers with taxable income between $157,500 and $207,500. The threshold amounts and phase-in range are for tax-year 2018 and will be adjusted for ination in subsequent years. 2018 TAX RATES SCHEDULE Y-1 - MARRIED FILING JOINTLY OR QUALIFYING WIDOW(ER) IF TAXABLE INCOME IS BUT NOT OVER OVER THE TAX IS $0 10% of the taxable amount $19,050 , $1,905 plus 12% of the excess over $19,050 $77,400 $8,907 plus 22% of the exoess over $77,400 $165,000 $28,179 plus 24% of the eltcess over $165,000 $315,000 $64,179 plus 32% of the encess over $315,000 $400,000 $91,379 plus 35% of the assess over $400,000 $600,000 no limit $161,379 plus 37% of the excess over $600,000 2018 STANDARD DEDUCTION Standard Deduction: Married ling jointly or Qualifying Widowier) Head of household