Ben and Molly are married and will file jointly. Ben generates $300,000 of qualified business income from his single member LLC (a law firm). He reports his business as a sole proprietorship. Wages paid by the law firm amount to $40,000; the law firm has no significant property. Molly is employed as a tax manager by a local CPA firm. Their modified taxable income is $386,600 (this is also their taxable income before the deduction for qualified business income). What is their tentative QBI based on the W–2 Wages/Capital Investment Limit? $ Determine their allowable QBI deduction for 2020

SWFT Comprehensive Vol 2020
43rd Edition
ISBN:9780357391723
Author:Maloney
Publisher:Maloney
Chapter15: Taxing Business Income
Section: Chapter Questions
Problem 28P
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Ben and Molly are married and will file jointly. Ben generates $300,000 of qualified business income from his single member LLC (a law firm). He reports his business as a sole proprietorship. Wages paid by the law firm amount to $40,000; the law firm has no significant property. Molly is employed as a tax manager by a local CPA firm. Their modified taxable income is $386,600 (this is also their taxable income before the deduction for qualified business income). What is their tentative QBI based on the W–2 Wages/Capital Investment Limit? $ Determine their allowable QBI deduction for 2020. $
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