Calculator eBook Problem 15-33 (LO. 3, 4) Susan, a single taxpayer, owns and operates a bakery as a sole proprietorship. The business is not a specified services business. In 2019, the business pays $60,000 of W-2 wages and reports qualified business income of $200,000. Susan also has a part-time job earning wages of $11,000 and receives $3,200 of interest income. Assume the QBI amount is net of the self-employment tax deduction. What is Susan's tentative QBI based on the W-2 Wages/Capital Investment Limit? Determine Susan's allowable QBI deduction. 31,100 Feedback Check My Work With the reduction in the corporate income tax rate to 21 percent in 2018, Congress needed to provide a means of reducing the taxes on businesses that operate in different business forms. Congress accomplished this with the creation of the deduction for qualified business ince (5 199A). Qualified business income (QBI) is defined as the ordinary income less ordinary deductions a taxpayer earns from a "qualified trad business" conducted in the United States by the taxpayer. Potubmission Answers: $30,000; $31,740. At its most basic level, 5 199A permits an individual to deduct 20 percent of the qualified business income generated through a sole proprietorship, a partnership, or an S corporation. Qualified business income (QBI) is defined as the ordinary income less ordinary deductions taxpayer earns from a "qualined trade or business" conducted in the United States by the taxpayer (e.g, from a sole proprietorship). It also includes the distributive share of these amounts from each partnership or S corporation interest held by the taxpayer. In determining QeI, all deductions attributable to a trade or business are taken into account. As a result, a taxpayer must reduce Q8I by the seif-employment tax deduction (6 164()), the self-employed health insurance deduction [5 162()), and any deduction for contributions to qualified retirement plane 4041. Qualified business income does not include certain types of investment income, such as: 1 Check My Work used MacBook Pro 5. 7. 8. 9. T