QBI Deduction Calculator for 2026
See how taxable income, business type, wages, and qualified property interact. Includes the 2026 active-business minimum for supported below-threshold cases.
Book a free consultationEnter your 2026 inputs
Illustrative starting values are prefilled, including the material-participation selection. Replace them with your own inputs and confirm each assumption.
Your calculation
- 2026 Section 199A deduction
- $20,000
- Regular deduction before minimum
- $20,000
- Supported active-business minimum
- $400
- Business component after phase-in
- $20,000
- Eligible REIT/PTP deduction component
- $0
- Taxable-income cap on regular deduction
- $36,000
- Wage/property limit before phase-in
- $0
- Phase-in percentage
- 0.0%
- Business QBI loss carried forward
- $0
- REIT/PTP loss carried forward
- $0
Threshold: $201,750. Phase-in range: $75,000. The regular deduction is subject to the income cap; a qualifying 2026 minimum is applied afterward.
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Educational estimate, updated September 29, 2026. Educational, not individualized tax advice. Single qualified business; entered QBI and allocable wages/property are already adjusted under Section 199A. Net capital gain input includes qualified dividends. REIT/PTP input is the separately determined eligible component. 2026 minimum implementation follows draft IRS instructions. Above-threshold minimum edge cases stop; multiple-business aggregation, cooperative rules and PTP SSTB adjustments are excluded.
Find the limit that changes the deduction
The Section 199A calculation begins with qualified business income, not revenue, gross profit, or cash in the bank. This single-business model uses enacted 2026 thresholds and separately displays its regular deduction, taxable-income cap, and supported minimum deduction.
- STEP 01
Use return-level inputs
Enter taxable income before the QBI deduction, after applicable deductions. QBI should already reflect allocable adjustments such as the deductible portion of self-employment tax and eligible retirement or health-insurance deductions. Employee wages, S-corporation reasonable compensation, and guaranteed payments generally are not QBI. Net capital gain for the taxable-income limit includes qualified dividends.
- STEP 02
Apply the business limits in order
For 2026, the threshold is $403,500 for joint returns, $201,775 for married filing separately, and $201,750 for single or head of household. Wage/property limits phase in across $150,000 on joint returns and $75,000 on other supported returns. Within that range an SSTB first reduces eligible QBI, wages, and property by its applicable percentage; above the range the SSTB business component is zero.
- STEP 03
Check the minimum and carryforwards
Beginning in 2026, qualifying active-business taxpayers may have a $400 minimum deduction with at least $1,000 of aggregate active QBI. For the supported single-business below-threshold case, current-year QBI controls this eligibility rather than QBI after prior loss carryforwards, following the 2026 draft instructions. Above-threshold minimum edge cases stop for full analysis. Draft form implementation can change before final forms are released.
Worked QBI examples
Educational 2026 examples for a single taxpayer; inputs are already adjusted QBI and taxable income before Section 199A.
Swipe horizontally to compare
| Scenario | QBI | Taxable income | Key constraint | Deduction |
|---|---|---|---|---|
| Below threshold | $100,000 | $180,000 | No capital gain; no prior losses | $20,000 |
| Taxable-income cap | $100,000 | $90,000 | $20,000 net capital gain plus qualified dividends | $14,000 |
| Active-business minimum | $1,500 | $50,000 | Material participation; no special adjustments | $400 rather than the regular $300 |
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Authoritative Sources
- 2026 thresholds: Revenue Procedure 2025-32
- Enacted Section 199A changes: Public Law 119-21, Section 70105
- Form 8995-A instructions: wage/property and SSTB ordering (2025)
- 2026 draft Form 8995 instructions: minimum deduction implementation (draft; subject to change)
Citations reflect U.S. federal tax law as of the article's last reviewed date.
Frequently asked questions
Is the QBI deduction still available in 2026?
Yes. Public Law 119-21 made Section 199A permanent and expanded the phase-in ranges beginning in 2026. Eligibility and limitations still depend on the trade or business and the complete return.
Does every business get a 20% deduction?
No. The deduction can be reduced by taxable-income limits, prior QBI losses, SSTB rules, and wage/property limitations. This tool shows those supported steps separately.
Are physicians and consultants SSTBs?
Many health and consulting businesses fall within specified-service categories, but classification depends on the actual business. Select SSTB only after confirming the applicable category. This tool does not determine classification.
What counts as W-2 wages?
Use wages properly allocable to the qualified business under Section 199A, not household wage income or owner distributions. This tool assumes the entered amount has already been determined under the applicable rules.
What is UBIA?
UBIA is unadjusted basis immediately after acquisition of qualified property under Section 199A. It differs from the remaining depreciated tax basis used in a sale calculation; eligibility and the property period matter.
Does this cover multiple businesses?
No. Aggregation, cross-business loss allocation, cooperative patron reductions, and PTP SSTB adjustments require the full Form 8995-A process. Selecting those exceptions stops the result rather than presenting a misleading deduction.
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