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QBI Deduction (Section 199A) Calculator

Owners of pass-through businesses can often deduct up to 20% of qualified business income. Enter your QBI and taxable income to see the basic deduction and whether the extra limits kick in.

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Estimated QBI deduction

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Tips for using the qbi deduction calculator

  • Retirement contributions and the deductible half of SE tax reduce QBI.
  • Near the threshold, extra pre-tax retirement savings can keep you under it.
  • Rental real estate can qualify if it rises to the level of a trade or business.

How the qbi deduction calculator works

Section 199A lets owners of sole proprietorships, partnerships, LLCs and S corporations deduct up to 20% of their qualified business income. The 2025 tax law made the deduction permanent.

Deduction = lesser of 20% × QBI and 20% × (Taxable income − Net capital gain)
2026 threshold: $201,775 single / $403,550 joint, phase-in range $75,000 / $150,000

Below the threshold, the simple 20% calculation applies to almost every business. Above it, the deduction for each business is limited to the greater of 50% of W-2 wages paid or 25% of wages plus 2.5% of qualified property, and specified service trades or businesses (such as law, health, consulting and financial services) lose the deduction entirely once fully above the range. QBI excludes wages you receive as an S corp owner, guaranteed payments and investment income. This calculator gives the basic deduction and flags when the limits apply; use IRS Form 8995 or 8995-A for the full calculation.

Worked example

A single filer with $100,000 of QBI and $150,000 of taxable income is below the $201,775 threshold. The deduction is the lesser of $20,000 (20% of QBI) and $30,000 (20% of taxable income): $20,000. In the 24% bracket that saves about $4,800 of federal income tax.

Tax estimates use 2026 federal figures and simplified rules. They are not tax advice; check with a tax professional.

Frequently asked questions

What is the QBI deduction?

A deduction of up to 20% of qualified business income from pass-through businesses, claimed on the individual return.

What are the 2026 QBI income thresholds?

$201,775 for single filers and $403,550 for joint filers, with phase-in ranges of $75,000 and $150,000 above those amounts.

Do S corp owners get the QBI deduction?

Yes, on their share of profit, but not on the salary they are paid.

Is the QBI deduction an itemized deduction?

No. It is taken after AGI and is available whether you itemize or take the standard deduction.

Updated October 2026. Results are estimates for education, not financial or medical advice. All math runs in your browser; nothing you type is sent anywhere.

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