QBI Deduction Calculator
Estimate your 2026 Section 199A QBI deduction, including simplified SSTB phase-outs above $201,750 (most returns) / $403,500 (joint).
Inputs
Enter the minimum numbers needed to get a result.
Formula and example
QBI Deduction = min(20% × Qualified Business Income, 20% × Taxable Income). In this simplified 2026 model, SSTBs phase out from $201,750–$276,750 for most returns and $403,500–$553,500 for joint returns.
With $80,000 of business income and $95,000 taxable income (under the 2026 threshold): 20% of QBI is $16,000 and 20% of taxable income is $19,000, so the simplified estimate is $16,000.
Methodology & assumptions
Last updated: 2026-07-29Calculation method
Estimates the Section 199A deduction using 2026 thresholds from IRS Rev. Proc. 2025-32. The deduction is generally limited by both qualified business income and taxable income; higher-income SSTB and non-SSTB rules require additional inputs this simplified tool does not collect.
Data sources
Uses the numbers you enter and standard small-business finance formulas. Benchmark comparisons use HustleFin industry benchmark pages where available.
Limitations
Planning estimate only. Above-threshold non-SSTB W-2 wage/UBIA limits are not modeled, and the tool omits net-capital-gain adjustments, REIT/PTP income, aggregation, and loss carryforwards. Consult a CPA or EA.
Input definitions
- Qualified business income: Net profit from your pass-through business (sole prop, LLC, S-corp, partnership) after expenses.
- Taxable income (before QBI): Your total taxable income before this deduction, after the standard or itemized deduction.
- Filing status: 0 = single / other, 1 = married filing jointly. Sets the income threshold where limits begin.
- Specified service business?: 1 = yes (health, law, accounting, consulting, financial, performing arts, athletics), 0 = no. Only matters above the income threshold.
- Federal marginal tax rate: Your top federal income tax bracket, used to estimate dollars saved.
Frequently asked questions
Who qualifies for the 20% QBI deduction?+
Owners of qualifying pass-through businesses may deduct up to 20% of qualified business income, subject to taxable-income and other limits. For 2026, the threshold is $201,750 for most returns and $403,500 for married filing jointly.
What is an SSTB and why does it matter?+
A Specified Service Trade or Business includes categories such as health, law, accounting, consulting, financial services, performing arts, and athletics. In the simplified 2026 model, the phase-out spans $201,750–$276,750 for most returns and $403,500–$553,500 for joint returns.
Is the QBI deduction still available after 2025?+
Yes. The Section 199A QBI deduction was scheduled to expire after 2025, but the One Big Beautiful Bill Act made it permanent. That removes the prior expiration and keeps the 20% pass-through deduction in place for future tax years.
Does QBI reduce my self-employment tax?+
No. The QBI deduction reduces your federal income tax by lowering taxable income, but it does not reduce self-employment tax (the 15.3% Social Security and Medicare tax). Self-employment tax is calculated on net earnings before the QBI deduction.
Why might my allowed deduction be less than 20% of my business income?+
Because the deduction is also capped at 20% of your taxable income (excluding net capital gains). If your taxable income is close to or below your business income — for example after the standard deduction — the taxable-income cap, not the 20% of QBI, becomes the binding limit.
Related guides
Go deeper with in-depth guides on the concepts behind this calculator.
Continue the workflow
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