Please help me figure out the Qualified business income deduction. I am trying to fill out tax form 8995.

Income statement for The Arc

Revenue:

Gross Sales $150,000.00 - Sales Returns and Allowances $0 = Net Sales $150,000.00

Cost of Goods Sold:

Beginning Inventory $11,000.00 + Purchases 66,000.00 = $77,000.00 - Ending Inventory 10,000.00 = Cost of Goods Sold 67,000.00

Gross Profit (Loss) = Net Sales $150,000.00 - Cost of Goods Sold 67,000.00 = $83,000.00

Expenses:

Dues and Subscriptions 0

Estimated Federal Tax Payments 4,000.00

Estimated State Tax Payments 3,800.00

Insurance 4,000.00

Meals and Entertainment 1,600.00

Miscellaneous 300.00

Payroll Taxes 4,000.00

Professional Fees 1,800.00

Rent 8,500.00

Travel 1,300.00

Utilities 1,500.00

Vehicle Expenses 0

Wages 25,000.00

Total Expenses 55,800.00

Net Operating Income = Gross Profit (Loss) $83,000.00 - Total Expenses 55,800.00 = $27,200.00

Noah and Joan also own a condo and use it as a rental property. The condo is at 16 Oakwood Ave, Unit A, Dayton, OH 45409. Noah provides management services for the rental including selection of tenants, maintenance, repairs, rent collection, and other services as needed. On average, Noah spends about two hours per week on the rental activity. The revenue and expenses for the year are as follows:

Rental income	$16,200
Insurance	800
Interest expense	5,800
Property taxes	1,500
Miscellaneous expenses	500

Rental income includes $1,150 monthly for two months under the previous lease (which ended February 28, 2022). The new lease is $1,300 per month for ten months under the new lease but the tenant paid only $900 in May 2022 because the tenant paid $400 for repairs to the apartment, and with the Arcs permission, reduced Mays rent by $400. The new lease also required the tenant to pay last months $1,300 rent in February 2022. The home was acquired for $85,000 in 2006. On May 12, 2022, the Arcs installed new fixtures (7-year recovery period) at a cost of $3,500. They wish to maximize the cost recovery on the new fixtures but make no elections.