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Boise Idaho Business Guide: 20% Business Income Deduction

To qualify for the new tax reform’s 199A 20% business income deduction you must:

  1. Have a qualified pass-through business entity.
  2. If you are a specified service or trade, then you are subject to the fade-in and fade-out.

Defining Terms Pass-thru entities and structures include:

  • Sole proprietorships (no entity, Schedule C)
  • Real estate investors (no entity, Schedule E)
  • Disregarded entities (single member LLCs)
  • Multi-member LLCs
  • Any entity taxed as an S corporation
  • Trusts and estates, REITs and qualified cooperatives

Specified Service Trade or Business is defined as:

  • Doctors
  • Attorneys
  • Accountants
  • Actuaries
  • Consultants
  • Performing artists who perform on stage or in a studio
  • Paid athletes
  • Anyone who works in the financial services or brokerage industry

This new tax deduction will dramatically decrease your Idaho business income taxes if used.

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