Technical topics regarding tax preparation.
10-Oct-2019 12:45am
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Can some explain how/why one would reduce QBI of an S Corp on the shareholder's personal return by the amount of SE above the line Health Ins Deduction?
Its already been subtracted to arrive at the S Corp's profit; to subtract it again seems weird?
Lacerte has an obscure box to check to accomplish this, but offers no explanation.
Q 33: ….. If I take the self-employed health insurance deduction for these premiums on my individual tax return, do I have to also include this deduction when calculating my QBI from the S-Corporation?
A33. Generally, the self-employed health insurance deduction under section 162(l) is considered attributable to a trade or business for purposes of section 199A and will be a deduction in determining QBI. This may result in QBI being reduced at both the entity and the shareholder level.
10-Oct-2019 5:35am
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Did you happen to try the yellow box (not to be confused with Lacerte’s obscure box) on this forum?
10-Oct-2019 7:26am
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Well, if you are using the wages paid from the S Corp as part of the calculation for the QBI deduction, then those wages should be reduced by the SEHI deduction, as it was counted in w-2 wages on the S Corp tax return. And they are already getting the SEHI deduction on their 1040 (assuming S Corp have a profit, since you care about reducing QBI deduction).
10-Oct-2019 1:21pm
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Did you happen to try the yellow box ...Poor kitty
viewtopic.php?f=8&t=15256
10-Oct-2019 4:29pm
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Goodday wrote:Can some explain how/why one would reduce QBI of an S Corp on the shareholder's personal return by the amount of SE above the line Health Ins Deduction?
Simple -- §199A was not written well. If the writers had consulted with any of a number of TPT contributors we would have told them that this was a problem. Alas, they didn't, and the IRS' position and Answer 33 is not inconsistent with the wording of the statute.
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