FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Rob Wriggle operates a small plumbing supplies business as a sole proprietor. In 2019, the plumbing business has gross business income of $421,000 and business expenses of $267,000, including wages paid of $58,000. The business sold some land that had been held for investment generating a long-term
The income threshold for QBI limitations starts at $321,400 for married filing jointly taxpayers.
a. What is Rob and Marie's taxable income before the QBI deduction?
b. What is Rob and Marie's QBI?
c. What is Rob and Marie's QBI deduction?
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PART A
A. What is Rob and Marie's taxable income before the QBI deduction?
| Particulars | Amount ($) |
| Marie's wage income | 250,000 |
| Business income (421,000 - 267,000) | 154,000 |
| Long term capital gain (15,000 + 13,000) | 28,000 |
| Total | 432,000 |
| Less : standard deduction | (24,400) |
| Rob and Marie's taxable income before the QBI deduction | 407,600 |
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