Deduction and credits

The Qualified Business Income Deduction (QBI) is a valuable tax benefit that can significantly reduce taxable income for eligible business owners. This deduction, introduced by the Tax Cuts and Jobs Act, allows many taxpayers to deduct up to 20% of their business income. However, understanding the rules and limitations is essential to maximize this opportunity. In this guide, we’ll break down everything you need to know, from eligibility requirements to calculation methods and income limits.

As a small business owner, independent contractor, or freelancer, you can take advantage of several common business deductions to lower your taxable income. Here are some deductions you may qualify for:

Startup costs follow different rules than ongoing business expenses. The IRS provides clear guidelines for deducting these startup costs, and understanding them can help you maximize your tax benefits.

For many companies, interest expenses constitute a significant portion of their operating costs, which is why the deduction of these expenses is a valuable tax benefit for businesses. Understanding this deduction can help business owners manage their finances more effectively and optimize their tax strategy.