The Tax Cuts and Jobs Act adds a deduction under IRC §199A for non-corporate businesses with "Qualified Business Income" (QBI) essentially equal to the lower of 20% of net business income or 20% of taxable income. For unmarried taxpayers, the amount before the phaseout begins is $157,500. For married taxpayers, the amount before the phaseout begins at $315,000. The 20% of QBI is limited to 20% of the sum of:
- Combined qualified trade or business income.
- Qualified REIT dividend income.
- Qualified publicly traded partnership income.
- Qualified cooperative dividends.
This deduction will almost certainly be taken after the amount of taxable income is figured.