QBI Calculator (Section 199A)
Estimate your 2026 qualified business income deduction: up to 20% of your self-employment or pass-through income. The 2026 limits start at $201,750 of taxable income (single) or $403,500 (married filing jointly), with the new $400 minimum deduction under IRC §199A(i).
Leave wages at $0 if you have no employees. UBIA of qualified property can be added on the methodology note below; most sole proprietors skip it.
How your QBI deduction is calculated
Where these numbers come from
Every threshold and range above comes from these IRS sources. Read them yourself.
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Common questions
What is the QBI deduction for 2026?
The Section 199A qualified business income deduction lets eligible self-employed people and owners of pass-through businesses deduct up to 20% of their qualified business income. It is a below-the-line deduction: you can take it even if you claim the standard deduction. It is now permanent: the One Big Beautiful Bill Act removed the sunset that had been scheduled after 2025.
What are the 2026 QBI income thresholds?
The W-2 wage and SSTB limits start at $201,750 of taxable income for single and head-of-household filers and $403,500 for married filing jointly, per IRS Rev. Proc. 2025-32. Below those levels every taxpayer gets the full 20% deduction regardless of business type. The phase-in range above the threshold widened for 2026: $75,000 for single filers and $150,000 for joint filers.
What is an SSTB and does it lose the deduction?
A specified service trade or business is one in health, law, accounting, consulting, financial services, athletics, or any field where reputation drives the income. Above the threshold an SSTB's deduction phases out across the range and is fully gone above it. Below the threshold an SSTB qualifies like any other business. Architecture and engineering are explicitly not SSTBs.
What is the W-2 wage limit?
Above the threshold, the deduction on each business is capped at the greater of 50% of the W-2 wages the business pays, or 25% of wages plus 2.5% of the unadjusted basis of qualified property. A solo consultant with no employees and no equipment can see the deduction shrink toward zero at high incomes, and this is the limit that surprises people most.
What is the new $400 minimum QBI deduction?
Starting with tax years after 2025, IRC §199A(i) guarantees a $400 minimum deduction if you have at least $1,000 of QBI and materially participate in the business. The $1,000 and $400 figures are inflation-adjusted starting in 2027.
What counts as qualified business income?
Net income from a domestic sole proprietorship, partnership, S corporation, or trust, including income reported on Schedule C. It excludes employee wages, capital gains and dividends, S corporation reasonable compensation, partnership guaranteed payments, and investment income. Rental real estate can qualify under the safe harbor.
Which IRS form do I use for the QBI deduction?
Form 8995 if your taxable income is at or below the threshold ($201,750 single / $403,500 joint), or Form 8995-A with its worksheets above it.
Is the QBI deduction still limited to 20% after the One Big Beautiful Bill Act?
Yes. A proposal to raise the rate to 23% did not make the final law, so the deduction stays at 20% of QBI, plus 20% of qualified REIT dividends and publicly traded partnership income. What changed is permanence, wider phase-in ranges, and the new $400 minimum.
Sourced to IRS Rev. Proc. 2025-32 and the IRS QBI guidance. Verified 2026-09-18.