Qualified Business Income Deduction - Pass-Through Partnership Income

Per the Instructions for Schedule K-1 (1065), page 18:

Code Z. Section 199A information. Generally, you may be allowed a deduction of up to 20% of your net qualified business income (QBI) plus 20% of your qualified REIT dividends, also known as section 199A dividends, and qualified PTP income from your partnership. The partnership will provide the information you need to figure your deduction. Use one of these forms to figure your QBI deduction.

  1. Use Form 8995, Qualified Business Income Deduction Simplified Computation, if all of the following apply.
    • You have QBI, section 199A dividends, or PTP income (defined below), and
    • Your 2019 taxable income before the QBI deduction is equal to or less than $160,700 ($321,400 if married filing jointly or $160,725 if married filing separately or a married nonresident alien), and
    • You aren’t a patron in a specified agricultural or horticultural cooperative.
  2. Use Form 8995-A, Qualified Business Income Deduction, if you don't meet all three of the above requirements.
  3. Use the information provided by your partnership to complete the appropriate form listed above. For definitions and more information, see the Instructions for Form 8995 or the Instructions for Form 8995-A, as appropriate.

See the instructions for additional information. 

To enter the Qualified business income (QBI) information from Schedule K-1 in TaxAct:

  1. From within your TaxAct return (Online or Desktop) click Federal. On smaller devices, click in the upper left-hand corner, then Federal
  2. Click Business Income under Federal Quick Q&A Topics to expand that category, then click Partnership income (Form 1065 Schedule K-1)
  3. Click +Add Partnership Schedule K-1 to create a new copy of Schedule K-1 or Edit to modify an existing form
  4. Continue through the interview questions until you reach the screen titled Partnership - Schedule K-1 Information, then check the box in front of Box 20 - Other Information, and then click Yes
  5. Click Continue until you reach the screen titled Partnership - Other Information - Box 20AA - AG
  6. The program will proceed with the interview questions for you to enter or review the appropriate information

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