1. Adam, a single taxpayer, is an attorney and practices as a sole proprietor. This year, Adam had net business income of $90,000 from his law practice (net of the associated for AGI self-employment tax deduction). Assume that Adam pays $40,000 in wages to his employees, has $10,000 of property (unadjusted basis of equipment he purchased last year), and has no capital gains or qualified dividends. His taxable income before the deduction for qualified business income is $100,000.

a. Do Legal services fall within the definition of specific service or trade businesses, which are excluded from deemed not to be qualified trade or businesses for purposes of the deduction for qualified business income?

b. Does Adams taxable income fall above the taxable income limits that exclude specified services making them ineligible for the QBI income?

c. Is Adam eligible for the QBI deduction?

d. If Adam is eligible for the QBI deduction is Adam subject to wage-based limits for the QBI deduction?

-----However, the wage-based limits only apply to taxpayers with taxable income in excess of $170,050 ($340,100, in the case of a joint return; $170,050 for married filing separate). Because Adams taxable income (before the deduction for qualified business income) is less than $170,050, the wage-based limits do not apply.

e. Adams qualified business income is ________________.

f. Adams QBI deduction is _________________________.

g. Adams taxable income before the QBI deduction is _________________________.

h. Is Adam subject to the taxable income limitation?