Section 199A QBI Deduction Calculator
Estimate your 2025 Qualified Business Income (QBI) deduction under Section 199A. Enter your business income, taxable income, W-2 wages, and filing status to see how much you can deduct — including phase-in and SSTB rules.
2025 phase-out: $197,300 – $247,300
Net income from your qualified business
From Form 1040 line 15 (before QBI deduction)
Total W-2 wages paid by the qualified business
Unadjusted basis of qualified depreciable property
SSTBs include law, health, consulting, financial services, athletics, and similar professions. Above the upper threshold, SSTB deduction is eliminated.
QBI Deduction
$20,000Effective QBI Rate
20.00%Limit Applied
None — Full 20% of QBI
| 20% of QBI | $20,000 |
| W-2 Wage / Property Limit | $0 |
| 20% Taxable Income Cap | $38,200 |
| Phase-In Percentage | 0.00% |
| QBI Deduction | $20,000 |
Below $197,300
Full 20% of QBI deduction with no W-2 or SSTB restrictions.
$197,300 – $247,300
W-2 wage and SSTB limitations phase in gradually.
Above $247,300
Full W-2 limits apply. SSTB businesses get $0 deduction.
Frequently asked questions
What is the Section 199A QBI deduction?
The Section 199A Qualified Business Income (QBI) deduction allows eligible self-employed individuals, sole proprietors, S-corp shareholders, and partners to deduct up to 20% of their qualified business income from their taxable income. It was introduced by the Tax Cuts and Jobs Act of 2017 and is scheduled to expire after 2025 unless extended by Congress.
Who qualifies for the QBI deduction?
You may qualify if you have income from a sole proprietorship, single-member LLC, partnership, S corporation, or trust that operates a qualified trade or business. The deduction is only available to non-corporate taxpayers. Specified Service Trades or Businesses (SSTBs) — such as law, health care, consulting, and financial services — are subject to additional restrictions for higher-income taxpayers.
What are the 2025 income thresholds for the QBI deduction?
For 2025, the phase-in range starts at $191,950 for single filers ($383,900 for married filing jointly) and ends at $241,950 ($483,900 for MFJ). Below the lower threshold, no W-2 or SSTB limitations apply. Above the upper threshold, the W-2 wage limitation is fully in effect, and SSTB businesses receive no deduction.
What is a Specified Service Trade or Business (SSTB)?
An SSTB is a trade or business where the principal asset is the reputation or skill of one or more employees or owners. This includes fields like health care, law, accounting, actuarial science, performing arts, consulting, athletics, financial services, brokerage services, and investing. If your taxable income exceeds the upper threshold, an SSTB receives no QBI deduction. If you are below the lower threshold, the SSTB restriction does not apply.