QBI Pass-Through Deduction Calculator 2026
Section 199A lets pass-through business owners (S-corp, partnership, sole prop) deduct 20% of qualified business income — up to taxable income limits. Phaseouts apply for SSTBs (lawyers, doctors, consultants) above $182,400 single / $364,800 joint (2026 thresholds). This tool computes your QBI deduction.
How QBI Deduction Works
Section 199A allows pass-through business owners to deduct 20% of qualified business income on federal taxes. Applies to S-corps, partnerships, sole proprietorships, and certain trusts. C-corps are excluded. Calculated separately for each qualified business if multiple.
SSTB Phase-Out
Specified Service Trade or Business (SSTB) — legal, medical, accounting, consulting, financial services, investment management, athletics, performing arts — phases out entirely above income threshold. 2026: full phase-out at $232,400 single / $464,800 joint. Below the start threshold, SSTBs get full deduction same as non-SSTBs.
Wage and UBIA Limit
Above income threshold, non-SSTBs face wage limit: greater of (a) 50% of W-2 wages paid by business, or (b) 25% of W-2 wages + 2.5% of unadjusted basis in qualified property. Solopreneurs paying no W-2 wages may lose deduction at high incomes unless they have substantial business property.
Source: IRS Section 199A, Pub 535, OBBB 2025 (P.L. 119-21). Last updated: May 2026.