Answered: ch is Dolly's QBI deduction?

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ch is Dolly's QBI deduction?

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter1: The Individual Income Tax Return

Section: Chapter Questions

Problem 11P: Christine is a single 50 -year-old taxpayer with no dependents, Her only income is $ 40,750 of...

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Concept explainers

Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.

Question

Dolly, a single taxpayer, has $400,000 of business income from her coffee store that she operates as a sole proprietorship. She has $100,000 of employee wages, $40,000 of qualified property, and $500,000 of taxable income before the deduction for qualified business income (QBI). How much is Dolly's QBI deduction?

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