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Section 199A Actual Tax Returns Comparison

By Jason Watson, CPA
Posted Wednesday, October 20, 2021

The computation can be maddening as we’ve demonstrated in the previous pages. So… we created fictitious tax returns for Fred Flintstone operating an S corporation (he bought Slate Rock and Gravel from Mr. Slate). You can see side by side the differences between 2017 and 2018, using the new tax brackets, the new standard deduction and the Qualified Business Income Deduction (QBID) along with Section 199A.

Our $25,000-a-year expensive tax software (UltraTax aka UltraPain) does a wonderful job showing the worksheet computations of the Section 199A deduction, line by line.

Here is a table for reference-

Filing Status TP Income SP Income Biz Inc SSTB 199A Deduction
single 30,000 70,000 14,000
single 60,000 140,000 28,000
single 60,000 140,000 Yes 10,920
married 60,000 140,000 28,000
married 60,000 140,000 Yes 28,000
married 60,000 150,000 140,000 28,000
married 60,000 150,000 140,000 Yes 24,920
married 40,000 150,000 160,000 30,680
married 40,000 150,000 160,000 Yes 27,305

SSTB refers to specified service trade or business. The following link shows copies of the 2017 tax returns plus the 2018 tax projection worksheets (TPW as we call it) for our buddy Fred-

wcginc.com/8313

Caution: Our software is using a strict interpretation of the tax code. This is where the accountant has to be the accountant, and prepare the tax return.

Taxpayer’s Comprehensive Guide to LLCs and S Corps 2023-2024 Edition

LLC's and S Corps bookTaxpayer’s Comprehensive Guide to LLCs and S Corps 2023-2024 Edition This KB article is an excerpt from our 420+ page book (some picture pages, but no scatch and sniff) which is available in paperback from Amazon, as an eBook for Kindle and as a PDF from ClickBank. We used to publish with iTunes and Nook, but keeping up with two different formats was brutal. You can cruise through these KB articles online, click on the fancy buttons below or visit our webpage which provides more information.

Taxpayer’s Comprehensive Guide to LLCs and S Corps

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LLC's and S Corps book

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Learn the latest tax updates and insights for small business owners in the 2023-2024 Edition.

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Read about tax updates for small business owners in the 2023-2024 Edition, in an accessible PDF!

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