QBI Deduction Calculator (Section 199A)
2026Calculate your Qualified Business Income deduction. See 20% deduction with W-2 wage and SSTB limits.
QBI Deduction
$30,000.00
Tax Savings
$7,200.00
Base (20% of QBI)
$30,000.00
Deduction Limits
| 20% of QBI | $30,000.00 |
| 50% of W-2 Wages | $40,000.00 |
| 25% of W-2 + 2.5% of UBIA | $22,500.00 |
| W-2 Wage Limit (higher of above) | $40,000.00 |
| 20% of Taxable Income | $40,000.00 |
| Effective QBI Deduction | $30,000.00 |
Phase-Out Status
| Status | Below phase-out — full deduction available |
Use the QBI Deduction Calculator (Section 199A) above to calculate your results. Enter your values and see instant results — all calculations run in your browser.
Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.
How It Works
This calculator determines your Qualified Business Income (QBI) deduction under Section 199A of the IRS tax code. This deduction can significantly reduce the taxable income for eligible self-employed individuals and small business owners, leading to substantial tax savings.
The calculator identifies your QBI, W-2 wages, and unadjusted basis of qualified property. It then calculates the lower of 20% of your QBI or 20% of your taxable income (before the QBI deduction and capital gains), subject to various income limitations and W-2 wage/property limitations for specified service trades or businesses (SSTBs) and non-SSTBs.
Incorrectly classifying your business as an SSTB or non-SSTB is a common mistake that can significantly impact your deduction. Also, be mindful of the taxable income thresholds that trigger the W-2 wage and property limitations, as these can reduce or eliminate the deduction.
Example: Freelance Graphic Designer
- 1 Sarah, a single freelance graphic designer, has $100,000 in QBI, $0 in W-2 wages, $0 in unadjusted basis of qualified property, and a taxable income (before QBI deduction) of $90,000. Her business is not an SSTB.
- 2 The calculator first determines 20% of her QBI ($100,000 * 0.20 = $20,000) and 20% of her taxable income ($90,000 * 0.20 = $18,000). Since her taxable income is below the threshold for W-2 wage and property limitations, the lower of these two amounts is her preliminary deduction.
- 3 Sarah's QBI deduction is $18,000.
- 4 This $18,000 deduction reduces Sarah's taxable income, resulting in a lower tax liability. It's crucial to understand how your business classification and income level affect the available deduction before filing.
Source: SBA — Business Guide · Last updated: April 2026
Frequently Asked Questions
What is the QBI deduction?
What is the income limit for the full QBI deduction in 2026?
Do doctors and lawyers get the QBI deduction?
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