I’ve received a few telephone calls in reference to this, so I thought I’d separate some fact from fiction. The fact is that there aren’t a lot of changes on the Qualified Business Income Deduction (QBI) in the One Big Beautiful Bill Act.
Notable facts include…
1 – QBI is now permanent. It was scheduled to end this tax year.
2 – It’s still a 20% deduction off of income for owners of qualified pass-through entities.
3 – The list of Specified Service Trades or Businesses that do not qualify for the deduction, including Legal, Medical, Finance and Accounting, hasn’t changed.
4 – Income phase outs, where a taxpayer no longer gets the deduction will continue to be indexed for inflation annually.
5 – The phase-in threshold has been increased from $50K to $75K for single taxpayers. On married filers it increased from $100K to $150K. This means that more taxpayers will qualify.
The news here is that it was made permanent. We no longer have to worry about it going away.
Let me leave you with this…
I received an email from one of my long-term readers that I wanted to share with all of you…
“Chris, you don’t know me. I’m not one of your clients, but I got on your email list during the Covid Shutdowns somehow and have read every piece that you ever sent me.
My accountant for the last 30 years has been my brother-in-law Jim. I’ve wanted to fire him for three decades but my wife won’t let me.
I wanted you to know that you, a person I’ve never even spoken to before, are the reason I’m still in business.
The advice and tax tips you provide in your newsletter got me through Covid. Without them, I never would have stayed open. Since then, the advice you provide has saved me thousands of dollars in taxes each year.
Whenever I sit down to do my taxes with my brother-in-law, I pull out the specific newsletters that I think will help me. Jim reads them, rolls his eyes, and says something like, “I never though of that before.”
I just wanted you to know how much you’ve helped a person that you don’t even know. Thank you, thank you, thank you.
May God bless you and your family. And please don’t stop writing!
Sincerely,
I’ve Purposefully Omitted His Name”
I can’t tell you how many emails I’ve received like this over the years. It’s sad to hear of people who are trapped in bad professional relationships.
This sort of thing isn’t supposed to happen in America.
I wish that I could have met him thirty years ago. If we’d actually been doing his accounting work over all of those years, it’s hard to imagine how much more money I could have saved him.
But it’s nice to know that we’ve been able to help even people we don’t know. If you find yourself in a similar situation, you know my number…
We’re all going to get through this. Let’s get through it together.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Payroll Services, or Accounting and Tax Work, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
888-310-0300
www.SalarySolutions.net
www.AccountingSolutionsLtd.com
Note that the only professional services provided by Accounting Solutions Ltd. are those specified in a written communication from our office detailing the scope of services to be rendered and the terms and conditions applicable to the engagement.