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In 2 0 2 3 , Wilma Way s sole proprietorship, WW Bookstore, generated $ 1 2 0 , 0 0 0 net profit. In

In 2023, Wilma Ways sole proprietorship, WW Bookstore, generated $120,000 net profit. In addition, Wilma recognized a $17,000 Section 1231 gain on the sale of business furniture. The business checking account earned $960 interest income.
Required:
Which of these income items are subject to self-employment tax?
Compute Wilmas 2023 self-employment tax, assuming Wilma has no other earned income.
Compute Wilma's allowable QBI deduction, assuming $43,000 of W-2 wages and $90,000 unadjusted basis of tangible depreciable property. Further assume the overall taxable income limitation on QBI does not apply and Wilmas overall taxable income is sufficiently high that the W-2 wage limitation applies.
Compute the overall impact of the bookstore activity on Wilmas 2023 taxable income.

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