Per IRS Publication 535, Business Expenses, page 49:
For tax years beginning after 2017, individual taxpayers and certain trusts and estates may be entitled to a deduction of up to 20% of their QBI from a trade or business, including income from a pass-through entity, but not from a C corporation, plus 20% of qualified real estate investment trust (REIT) dividends and qualified publicly traded partnership (PTP) income.
The deduction is subject to multiple limitations, depending on the taxpayer’s taxable income, and may include the type of trade or business, the amount of W-2 wages paid by the trade or business, and the unadjusted basis immediately after acquisition (UBIA) of qualified property held by the trade or business.
The deduction can be taken in addition to the standard or itemized deductions. For more information, see section 199A, the Regulations section 1.199A, Rev. Proc. 2019–11, and Notice 2019–07.
Taxpayers Who May Take a Qualified Business Income Deduction
Individuals, estates, and trusts may take a QBI deduction.
S corporations and partnerships. S corporations and partnerships are not eligible for thededuction. Instead, S corporations and partnerships must pass through the necessary information to their shareholders or partners so theymay figure their deduction.
S corporations and partnerships must reporteach shareholder’s or partner’s share of the following items for each qualified trade or business (or aggregated trade or business) onSchedule K-1, so the shareholder or partnermay figure their deduction.
For more information, see Publication 535.